Dollar Slides by 0.4% Against Six Major Rivals

Dollar

The United States of America dollar on Thursday, September 7, slumped against the euro  as the European Central Bank left its benchmark interest rate unchanged.

The ICE U.S. Dollar Index DXY, -0.57% a gauge of the greenback’s performance against six rivals, fell 0.4% to 91.778, with the euro the biggest drag on the dollar indicator. The WSJ Dollar Index BUXX, -0.54% which measures the buck against a larger basket of currencies, gave up 0.4% to 84.983

Adding to the dollar’s downward trend was mixed employment data on Thursday morning. Weekly initial jobless claims were at 298,000, versus a 242,000 consensus, while productivity and unit labor costs for the second quarter came in at 1.5% and 0.2%, respectively, in line with expectations.

The dollar late Wednesday pared its losses against most major rivals after lawmakers and the White House agreed to a deal that extends the deadline for raising the federal government’s debt limit for around three months to mid-December.

In other action, the dollar USDJPY, -0.53% bought 108.87 Japanese yen, down from ¥109.22 late Wednesday. Against the Swiss franc USDCHF, -0.4287% the greenback bought 0.9532 francs from 0.9564 francs.

The pound GBPUSD, +0.3297% rose to $1.3080. briefly rising above $1.31, from $1.3042 on Wednesday. The pound hadn’t traded above $1.31 since early August.

Elsewhere in North America, the buck lost more ground against the Canadian dollar USDCAD, -0.7033% buying C$1.2172 compared with C$1.2229 late Wednesday in New York. The Bank of Canada raised interest rates for the second time this year on Wednesday, pushing its currency higher.

The ECB will keep buying €60 billion a month at least through the end of December, while its benchmark interest rate will remain at 0%, according to the central bank, MarketWatch reports.

The currency’s rally was also deemed responsible for the revision of the ECB’s inflation target, which was cut to 1.2% and 1.5% in 2018 and 2019, respectively, compared with earlier estimates of 1.3% and 1.6%.

 

 

 

 

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