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The US Dollar Index rose marginally on Thursday, finishing around 104.40, despite weak economic data and the decline in US yields.
Economic Data
US Continuing Jobless Claims reached the highest level since 2022, with Initial Claims rising to 231,000. Industrial Production declined by 0.6% in October, exceeding the expected contraction. The Philadelphia Fed Manufacturing Survey Index rose from -9 to -5.9, and the Kansas Fed Manufacturing Activity index recovered from -8 to -3 in November. On Friday, the US will report Building Permits and Housing Starts.
Key Developments
The Dollar bottomed after the data but then recovered even as US yields headed towards weekly lows, with the 10-year falling to 4.43%. The data released on Thursday pointed to a softer labor market and reinforced the perspective that the Federal Reserve is unlikely to raise interest rates further.
Gold jumped and posted the highest close in over two weeks, above $1,980. Silver reached the highest level in two months but failed to hold above $24.00 and trimmed gains, retreating to $23.75. Oil prices tumbled around 5%, and the WTI settled near $73.00, the lowest in four months, affected by concerns about global oil demand.
EUR/USD finished practically flat around 1.0850, with the pair hitting a fresh monthly high just below 1.0900 before pulling back. Eurostat will release the final reading of the October Consumer Price Index, which is expected to show no surprises. European Central Bank President Christine Lagarde will speak at the Frankfurt European Banking Congress, but her words will likely have little impact as the market expects the central bank to keep rates unchanged in the upcoming meetings.
GBP/USD lost ground but managed to finish above 1.2400, while the New Zealand Producer Price Index is due on Friday. The Australian Dollar failed to benefit from an upbeat jobs report and higher inflation expectations. The Canadian Dollar was among the worst performers, hit by the decline in oil prices.
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