Weekly jobless claims claims stand on 333K, within expectations. They were expected to rise from 328K (revised up from 326K, lowest since January 2008) to 335K this time. Continuing claims were expected to remain almost unchanged at a level of 2.95 million and they provided a big disappointment, rising above 3 million to 3.018 million. A point of light comes from the 4 week moving average that dropped to 330K, the lowest since November 2007, just before the recession began, but this is not enough for the dollar, at least for now.
EUR/USD moved above the 1.3350 line but found it hard to stay on top of it. USD/JPY bounced above the lows of 96, but remained close to this level. GBP/USD traded around 1.55 and AUD/USD consolidated the recovery around 0.9070. The initial reaction to the “within expectations” headline figure and the disappointing continuing claims is a minor weakening of the dollar. The USD bulls remain hungry.
It seems that the biggest reaction is seen at USD/JPY which falls 20 pips to 96.22. Other pairs make a marginal initial reaction. But, will the dollar continue sliding?
This weekly publication has a higher influence than normal due to the fact that the Fed puts a lot of emphasis on jobs. Lately, also the continuing claims gained importance, especially after the encouraging drop under 3 million.
Earlier in the week, Charles Evans, a known FOMC dove, speculated about QE tapering in September. In addition, job openings (JOLTS) rose to 3.94 million, the highest since 2009. Also the US trade deficit dropped to the lowest levels since 2009. However, after the initial rises, the dollar returned to falling.
Further reading: The dollar not going to plan
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