The dollar softened on Thursday as global stock markets turned down and economic data sent contrary signals about whether the US Federal Reserve would raise US interest rates as early as next week. European stocks broke a three-day run of gains with a drop of 1 percent following a difficult session in Asia, and Wall Street traded off 0.20 percent as data showed a decline in Chinese car sales and slowing capital spending in Japan.
The US government reported that the number of Americans filing new applications for unemployment benefits fell last week, a bullish signal about the labour market that bolsters arguments that the Fed will lift rates next week or later in 2015. "The data capture the Fed's conundrum: evidence of a tight labor market and evidence of low, if not moderating inflation," said David Gilmore, partner at Foreign Exchange Analytics in Essex, Connecticut. The Fed's policy-setting committee on September 16 and 17 may end with an announcement of a rate increase.
The dollar index, a basket of six currencies valued against the greenback, was last off 0.15 percent. It has moved in tandem with global equities in recent months. The dollar was down 0.08 percent against the euro at $1.1213 and up 0.25 percent against the yen at 120.80 yen. The yen slipped after comments by a Japanese lawmaker renewed speculation the Bank of Japan would loosen policy again.
Sterling reached a two-week high of $1.5449 after minutes from the Bank of England's latest policy meeting showed an 8-1 vote to keep rates at 0.5 percent. New Zealand's dollar regained some ground after losing more than 2 percent and was last off against the US dollar at $0.6270.
Comments
Comments are closed.