Dollar retreats in holiday-impacted trading; euro helped by German PMIs
Investing.com — The U.S. dollar retreated in thin holiday-impacted trade Thursday, with traders digesting recent economic data and what it potentially means for the Federal Reserve’s interest rate policy.
At 03:00 ET (08:00 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, fell 0.3% to 103.510, just above the 2-1/2-month low of 103.17 seen earlier this week.
The dollar received a minor boost on Wednesday after the weekly jobless claims data showed the number of Americans filing new claims fell more than expected last week, pointing to a still healthy labor market.
Additionally, the University of Michigan’s inflation expectations were revised higher, but this was countered by data showing orders for long-lasting U.S. manufactured goods fell more than expected in October.
That positive tone hasn’t lasted long, although trading volumes are limited with both Japan and the U.S. on holiday, the latter celebrating Thanksgiving.
“Part of the rebound in the dollar observed over the past two sessions … may well be related to some profit-taking on risk-on trades and more defensive positioning ahead of Thanksgiving,” said analysts at ING, in a note.
The index is down about 2.5% so far in November and on course for its worst monthly performance in a year, with the market fully expecting the Fed to stand still on rates in December before starting to cut some time next year.
In Europe, EUR/USD rose 0.3% to 1.0922, ahead of the release of the minutes from the European Central Bank’s October policy meeting, the gathering that saw the ECB snap an unprecedented streak of 10 consecutive rate hikes.
Helping the euro has been the release of the region’s business activity data for November. While
Read more on investing.com
