RTTNews - There was no relief in sight for the dollar on Thursday, as the safe haven currency continued to take it on the chin amid speculation that a global economic recovery is inevitable despite this week's sobering economic news.
The buck was supported by a bit of profit taking in very early dealing, but the rout began again in earnest as traders favored higher yielders like the euro and commodities-linked currencies such as the Canadian loonie.
Even the pound extended its dramatic recent gains versus the dollar in spite after Standard & Poor's revised the outlook on the United Kingdom to negative from stable. The rating agency affirmed 'AAA' long-term and 'A-1+' short-term sovereign credit ratings.
The dollar hit multi-month lows against a basket of key majors as traders weighed a lackluster jobs report and yesterday's gloomy economic assessment from the minutes of the last Federal Reserve meeting.
The dollar plunged to 1.3900 versus the euro, its lowest level since the first week of the year. The dollar has fallen a full 10 cents this month, despite doubts about whether European policy makers have the euro zone in position to join the global recovery.
Against the sterling, the dollar dropped to a 6-month low of 1.5889, as traders bet the buck's run to a 23-year high of 1.3501 in January was way overdone.
Standard & Poor's credit analyst David Beers said, We have revised the outlook on the U.K. to negative due to our view that, even assuming additional fiscal tightening, the net general government debt burden could approach 100% of GDP and remain near that level in the medium term.
The buck hit a fresh 2-month low against the yen, slipping to 93.85. With the loss, the dollar edged closer to a 13-year low of 87.08 set earlier in the year.
With oil prices remaining above $60 on Thursday, the dollar remained under pressure versus the petro-linked loonie, slipping to a new 7-month low of 1.1347.
A research firm known as the Conference Board said Thursday its index of leading economic indicators rose 1.0 percent in April, indicating signs of improvement in the general economy a few months down the line.
The Conference Board's coincident index dipped 0.2 percent for the U.S. fell again in April, while the index of lagging economic indicators slipped 0.5 percent.
Meanwhile, the number of people filing first-time unemployment claims dipped last week, easing fears that there had been a broad-based resurgence in layoffs.
Still, the government's unemployment rolls continue to swell, reaching another record high in the latest data. With auto industry cut backs contributing to the weak jobs market, the evidence points to continued increases in unemployment for th near future.
The U.S. Labor Department revealed that initial jobless claims came in at 631,000 for the week ended May 16th. This was down 12,000 from the previous week's revised total of 643,000.
The number of people receiving ongoing unemployment help, a figure known as continuing claims, rose again in the latest statistics. Continuing claims climbed to 6.662 million - yet another record high.
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