Dollar Moves Down Amid Increase In Jobless Claims

Dollar Moves Down Amid Increase In Jobless Claims by Andrew Blumer last updated on June 21, 2023

During the Thursday trading session, the US Dollar went on the back foot as the US jobless claims increased sharply. According to experts, the current state of the FX markets shows it is undergoing consolidation ahead of the Fed's decision and inflation report.

Overall, the jobless claims are now sitting at a 1-1/2 year high, with 261,000 people applying for benefits. For the week, around 28,000 people claimed benefits which have raised alarms among the market participants.

According to one chief strategist, the jobless claims were higher than expected, which has pushed the market into consolidation mode. He also added that the current market conditions reveal that we are trapped.

Although Dollar has been on the back foot, it hasn't shown any extreme bearish moves. According to experts, this is due to some rumors that the Fed will raise interest rates once again in the July meeting.

However, we can't ignore the economic data coming out of the USA which doesn't paint a very good picture of the US economy.

Euro Up By 0.75%

Against the US Dollar, the Euro gained the upper hand and was up by 0.75%. This is an impressive move considering how the EU economy is undergoing a technical recession during Jan, Feb, & March of 2023.

Similarly, the greenback was down by 0.87% against the Japanese Yan. The USD/JPY was last seen trading near the 138.94 level.

If we look at the Dollar index, it was down by 0.67% against the basket of other currencies and was last seen trading at 103.33.

Just like that, the CAD also gained the upper hand amid a weak US Dollar and the recent rate hike from the Bank of Canada. In the Canada, the interest rate is now standing at a 22-year's high which is a record on its own.

Over all, it appears the US Dollar is now waiting for the fed meeting to provide clear direction on what's ahead!