US Session – Dollar declines as market ponders shutdown consequences
October 17, 2013 7:47 pm
The US dollar continued to lose ground against most majors during late New York trading. The euro was up 0.1% against the greenback at 1.3675, hovering near the session highs of 1.3681.
The market was in the process of digesting the previous day’s deal and particularly if it meant that the standoff of the last three weeks would be repeated in about three months’ time. That is when the extension to the continued funding of the Federal government is set to expire (January 15), while a new debt ceiling was set for February.
The dollar held its ground against the Japanese yen, posting a slight 0.03% gain to trade at 97.85. Pound sterling wrapped up a particularly strong day against the dollar by gaining 0.26% to trade at 1.6159.
In economic statistics, weekly US Jobless Claims, one of the few economic indicators available following the shutdown, fell by 15,000 to 358,000. The figure was higher than expectations for a drop to 335 thousand.
According to commentators, the higher-than-expected figure was due to computer glitches in California, which contributed to the buildup of a backlog of unprocessed claims. This has artificially boosted claims in recent weeks in an otherwise slowly healing US jobs market.
The Philly Fed Index for October came in higher-than-expected at 19.8 versus a 15.0 consensus forecast. The index was down from 22.3 the previous month. The employment component of the survey showed a significant increase.
Chicago Fed President Charles Evans said in remarks following a speech that the Fed would probably wait for a couple of meetings before taking any action, so that the disruption in economic data is first overcome.
Elsewhere, FOMC dissenter Esther George, President of the Kansas City Fed, repeated her view that the Fed should begin to reduce bond purchases at the next meeting at the end of October.
As a result of speculation that the Fed would keep its QE program intact for longer, gold added to its steep gains of the European session by rising 0.25% to 1319.40 dollars per ounce.
The US dollar continued to lose ground against most majors during late New York trading. The euro was up 0.1% against the greenback at 1.3675, hovering near the session highs of 1.3681.
The market was in the process of digesting the previous day’s deal and particularly if it meant that the standoff of the last three weeks would be repeated in about three months’ time. That is when the extension to the continued funding of the Federal government is set to expire (January 15), while a new debt ceiling was set for February.
The dollar held its ground against the Japanese yen, posting a slight 0.03% gain to trade at 97.85. Pound sterling wrapped up a particularly strong day against the dollar by gaining 0.26% to trade at 1.6159.
In economic statistics, weekly US Jobless Claims, one of the few economic indicators available following the shutdown, fell by 15,000 to 358,000. The figure was higher than expectations for a drop to 335 thousand.
According to commentators, the higher-than-expected figure was due to computer glitches in California, which contributed to the buildup of a backlog of unprocessed claims. This has artificially boosted claims in recent weeks in an otherwise slowly healing US jobs market.
The Philly Fed Index for October came in higher-than-expected at 19.8 versus a 15.0 consensus forecast. The index was down from 22.3 the previous month. The employment component of the survey showed a significant increase.
Chicago Fed President Charles Evans said in remarks following a speech that the Fed would probably wait for a couple of meetings before taking any action, so that the disruption in economic data is first overcome.
Elsewhere, FOMC dissenter Esther George, President of the Kansas City Fed, repeated her view that the Fed should begin to reduce bond purchases at the next meeting at the end of October.
As a result of speculation that the Fed would keep its QE program intact for longer, gold added to its steep gains of the European session by rising 0.25% to 1319.40 dollars per ounce.
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