The US dollar rose against the euro, boosted by comments from EU officials regarding the single currency's strength which will be discussed at the Group of Seven meeting. Fading risk appetite amid a mixed batch of US economic data has also prompted investors to seek the perceived safety of the greenback. In other news, data released today showed US initial jobless claims rose in the latest week, a reminder that the labor sector is far from stable. The greenback also gained after a key US manufacturing index for September came in lower than expected.
The euro extended losses against the US dollar and pound on comments from European Central Bank President Jean-Claude Trichet that excess currency moves have adverse implications. Earlier in the week, Trichet also made comments that it was extremely important to have a strong dollar. All of these strong US dollar supportive comments have had a very negative impact on the single currency overall.
Sterling gained against a broadly weaker euro as European officials expressed discomfort over the single currency's recent rise. However, the pound was weighed down against the US dollar on speculation monetary authorities would express some form of verbal support for the US currency at the G7 meeting.
The Japanese yen gained against the US dollar as US equities opened weaker. The S&P 500 was down 0.8 percent at 1,048.29, dragging the dollar down to 89.53 yen, a session low. The yen also received a boost from recent risk aversion in the market, driving safe haven flows into the currency.
The Canadian dollar was slightly higher against the US currency as commodity prices were steady and market players prepared for Friday's US jobs figures. The price of oil, a key Canadian export, was steady above $70 a barrel after jumping more than 5 percent on Wednesday and gold was also steady. The Bank of Canada's concern that the Canadian dollar is too strong is waning as the nation's economic recovery firms, removing an obstacle to the loonie's further appreciation.
The Australian dollar hit a14-month high against the US dollar early in the session but failed to retain gains as local investors sold into its strength, and after a late jump in the US dollar on speculation officials may try to support the US currency. The New Zealand dollar was little changed on Thursday, with investors unwilling to chase the currency up ahead of US payrolls data at the end of the week.
10-Year Treasury Note Yield: 3.226%
Dow Jones Industrial Average: 9,610.10-101.88