The dollar index (DXY00) on Thursday fell by -0.30%. A rally in stocks Thursday reduced the liquidity demand for the dollar. Also, the dollar fell back on Thursday’s news that U.S. weekly continuing jobless claims rose more than expected to a 9-1/2 month high, which was dovish for Fed policy. However, higher T-note yields Thursday provided underlying support for the dollar.
Thursday’s U.S. weekly jobless claims report was mixed for the dollar. Weekly initial unemployment claims rose +4,000 to 230,000, right on expectations. However, weekly continuing claims rose +62,000 to a 9-1/2 month high of 1.671 million, showing a weaker labor market than expectations of 1.618 million.
EUR/USD (^EURUSD) on Thursday rose by +0.51%. The euro saw support from a weaker dollar and from expectations that the ECB will raise its main refinancing rate by +50 bp at next Thursday’s policy meeting.
USD/JPY (^USDJPY) on Thursday rose by +0.04%. The yen on Thursday posted modest losses as higher T-note yields weighed on the yen. However, losses in the yen were limited after Thursday’s news showed Japan's Q3 GDP contracted less than expected.
Thursday’s Japanese economic news was mixed for the yen. On the negative side, the Japan Oct current account balance unexpectedly posted a deficit of -64.1 billion yen versus expectations of a surplus of +622 billion yen. Also, the Japan Nov eco watchers expectations outlook survey unexpectedly fell -1.3 to a 4-month low of 45.1, weaker than expectations of an increase to 46.8. On the positive side for the yen, Japan's Q3 GDP was revised upward to -0.8% (q/q annualized) from the initially reported -1.2%, stronger than expectations of -1.0%.
February gold (GCG3) on Thursday closed up +3.50 (+0.19%), and March silver (SIH23) closed up +0.324 (+1.41%). Precious metals Thursday closed moderately higher. A weaker dollar Thursday was bullish for metals prices. A rally in copper prices to a 3-week high Thursday also provided carry-over support to silver prices on a possible increase in industrial metals demand in China after Bloomberg reported that Chinese authorities might further soften their stance on property policies. Higher global government bond yields Thursday limited the upside in gold prices. Also, gold continues to be undercut by fund liquidation as long positions in gold ETFs dropped to a new 2-1/2 year low Monday.
More Precious Metal News from Barchart
- Stocks Climb on Signs the U.S. Labor Market May be Cooling
- Dollar Undercut by Lower T-note Yields
- Stocks Under Pressure as Weak Chinese Trade News Sparks Global Growth Concerns
- Markets Today: Stocks Mixed On Negative Chinese Trade News
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