The greenback remained under pressure against major currencies on Thursday and fell to another fresh 2009 lows versus euro n Swiss franc on continuing purchase in risky assets as optimism on economic recovery remained. Jobless claims in U.S. came out at an increase of 550,000, less than both previous week (revised to 576,000) and economists' forecast of 560,000. Stock markets were strong under active buying on high-yielding assets. Dow Jones Industrial Average Index rose 80 points to end at 9627.
Euro retreated from 1.4608 to 1.4502 in U.S. morning on cross selling due to long liquidation, however, price received a boost from strong U.S. equities and rose to another fresh 2009 high of 1.4614 in New York afternoon. Swiss Franc once rebounded to 1.0466 due to rumour that SNB was checking exchange rates, however, neither SNB and BIS (Bank of International Settlement) was seen selling the Swiss Franc and price fell again to as low as 1.0358 in line with greenback’s broad-based weakness.
Cable hit a one-month high at 1.6688 following the Bank of England's decision to leave interest rates unchanged at 0.5% and also the size of its asset purchases program at 175 billion pounds. Traders took the decision by BOE as a sign that the worst of the economic downturn in the U.K. was over. On commodities currencies, kiwi advanced to as high as 0.7045 while aussie was also closed to its 2009 high of 0.8669 (ended at 0.8641).
U.S. Treasury Secretary Geithner said that the economy already regained enough strength so the economic strategy will shift from rescue to preparing for future growth. Geithner also provided a number that banks those got capital injection in from taxpayers had repaid more than $70 billion, reducing the government’s total investment to $180 billion, and another $50 billion repay is expected over the next 12 to 18 months.
Economic data to be released on Friday include:
GDP and consumer confidence in Japan; WPI in Germany; PPI in U.K.; new housing price index in Canada; University of Michigan confidence index, wholesale inventories and Fed budget in the United States.