- U.S. jobless claims hit over 49-year lows, PPI heats up
- Fed officials see slowing growth, market warnings
- Sterling slips after EU sets new Brexit deadline in Oct
- Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
(Updates to late U.S. action)
The dollar strengthened against a basket of currencies on Thursday on encouraging U.S. inflation and labor data, while sterling weakened after the European Union allowed Britain to postpone its exit from the bloc for a second time.
The euro remained under pressure a day after European Central Bank President Mario Draghi made glum comments on the euro-zone economy.
First-time filings for U.S. jobless benefits dropped to a 49-1/2-year low last week, pointing to sustained labor market strength that could counter fears of a sharp slowdown in U.S. economic growth. Overall producer prices grew 0.6% in March, the most in five months, while the underlying wholesale inflation rose by a milder 0.3%.
The dollar was trading higher "off the back of a very low jobless claims number and fairly robust PPI numbers. Overall, what you're seeing is a shift into dollars on fading expectations for a rate cut later this year," said Karl Schamotta, director of foreign exchange strategy and structured products at Cambridge Global Payments.
A few Federal Reserve policymakers, in separate comments on Thursday, indicated that current interest rates were appropriate. A couple expressed concerns about the recent inversion of the U.S. yield curve as an omen for a slowdown.
"We are going to need deviations to the downside on inflation or the real economy or both" to justify a rate cut, St. Louis Fed President James Bullard told reporters.
In late U.S. trading, an index that tracks the dollar versus a basket of currencies .DXY was up 0.21% at 97.153. The dollar index has held in a tight 0.5-point range this week.
The euro fell in the aftermath of Draghi's comments on Wednesday, which underscored the risks facing the euro zone economy and supported the view of possibly more ECB stimulus to prevent the region from slipping into recession.
The single currency EUR= was 0.13% lower at $1.12595 but was up 0.46% at 125.7 yen.
Sterling GBP= was 0.24% weaker at $1.3057 and 0.15% lower at 86.23 pence.
EU leaders late Wednesday extended the deadline for Britain to leave the economic bloc, quelling concerns of an immediate, chaotic departure. The move was offset by the prospects of UK Prime Minister Theresa May's replacement, a general election and the threat to the UK economy of prolonged uncertainty.
"Concern around Brexit and the ECB's increasingly dovish stance is weighing on euro and sterling," said Schamotta.
======================================================== Currency bid prices at 3:39PM (1939 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.1260 $1.1273 -0.12% -1.82% +1.1290 +1.1250 Dollar/Yen JPY= 111.6200 111.0000 +0.56% +1.23% +111.6900 +110.9100 Euro/Yen EURJPY= 125.70 125.13 +0.46% -0.41% +125.7300 +125.0500 Dollar/Swiss CHF= 1.0030 1.0024 +0.06% +2.20% +1.0046 +1.0011 Sterling/Dollar GBP= 1.3058 1.3089 -0.24% +2.36% +1.3108 +1.3052 Dollar/Canadian CAD= 1.3372 1.3320 +0.39% -1.94% +1.3397 +1.3313 Australian/Doll AUD= 0.7123 0.7170 -0.66% +1.05% +0.7171 +0.7117 arEuro/Swiss EURCHF= 1.1294 1.1300 -0.05% +0.36% +1.1314 +1.1290 Euro/Sterling EURGBP= 0.8621 0.8612 +0.10% -4.04% +0.8634 +0.8602 NZ NZD= 0.6729 0.6764 -0.52% +0.18% +0.6770 +0.6724 Dollar/DollarDollar/Norway NOK= 8.5331 8.4936 +0.47% -1.22% +8.5444 +8.4830 Euro/Norway EURNOK= 9.6113 9.5768 +0.36% -2.98% +9.6204 +9.5733 Dollar/Sweden SEK= 9.2864 9.2614 +0.10% +3.60% +9.2947 +9.2323 Euro/Sweden EURSEK= 10.4577 10.4470 +0.10% +1.89% +10.4582 +10.4178
