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Dollar strengthens broadly after mixed U.S. data

Published 02/26/2015, 08:50 AM
Updated 02/26/2015, 08:50 AM
Dollar rises against other majors after string of U.S. economic reports

Investing.com - The dollar strengthened broadly against a basket of other major currencies on Thursday, as the release of a flurry of U.S. economic reports overshadowed recent comments by Federal Reserve Chair Janet Yellen.

The U.S. Department of Labor reported that the number of individuals filing for initial jobless benefits in the week ending February 21 increased by 31,000 to 313,000 from the previous week’s revised total of 282,000.

Separately, the U.S. Commerce Department said that total durable goods orders increased by 2.8% last month, above expectations for a gain of 1.7%, while core durable goods orders, excluding volatile transportation items, inched up 0.3% in January, disappointing forecasts for a 0.5% gain.

Data also showed that U.S. consumer prices declined 0.7% last month, compared to estimates for a decline of 0.6%, while core consumer prices, which exclude food and energy costs, increased by 0.2% in January, above expectations for a 0.1% increase.

The data came after Federal Reserve Chair Janet Yellen dampened demand for the greenback this week by saying that it was "unlikely" that economic conditions would warrant an interest rate increase for "at least the next couple of FOMC meetings".

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.52% to 94.73.

EUR/USD dropped 0.57% to 1.1298.

The euro showed little reaction to a report showing that the number of unemployed people in Germany fell by 20,000 this month, compared to expectations for a drop of 10,000. The unemployment rate held steady at 6.5% in February, in line with expectations.

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A separate report showed that the German Gfk consumer climate index rose to 9.7 from 9.3 in January, slightly ahead of forecasts of 9.6.

The dollar rose against the yen and the Swiss franc, with USD/JPY edging up 0.12% to 119.03 and with USD/CHF gaining 0.37% to trade at 0.9519.

In other trade, pulled away from a two-month high of 1.5552 hit earlier in the session, with GBP/USD sliding 0.34% to 1.5475.

The Office for National Statistics earlier reported that the U.K. gross domestic product expanded by 0.5% in the final three months of 2014, unchanged from an initial estimate and in line with expectations. The U.K.’s economy grew by 0.7% in the previous quarter.

Year-over-year, U.K. economic growth grew 2.7% in the three months to December, unchanged from a preliminary reading. The U.K. economy expanded at an annualized rate of 2.6% in the third quarter of 2014.

The New Zealand dollar remained stronger, with NZD/USD up 0.15% to 0.7565 after data earlier showed that New Zealand's trade balance swung into a surplus of NZ$56 million last month from a deficit of NZ$195 million in December.

Meanwhile, the Australian and Canadian dollars turned lower, with AUD/USD shedding 0.32% to 0.7861 and with USD/CAD adding 0.24% to 1.2466.

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