After a tumultuous day of trading during the Asian and European sessions on Thursday, the U.S. dollar experienced a notable uptick during the New York session, fueled by data reflecting a stronger-than-anticipated growth in U.S. retail sales for September. Additionally, a decline in jobless claims further supported the dollar’s ascent.
According to the Commerce Department, retail sales increased by 0.4% in September, following a slight rise of 0.1% in August. Economists had forecasted a 0.3% increase in retail sales. When excluding sales from motor vehicle and parts dealers, retail sales rose by 0.5% in September, compared to a 0.2% increase in August. Prior expectations suggested that ex-auto sales would see a minimal rise of 0.1%.
A different report from the Labor Department indicated an unexpected decrease in first-time claims for U.S. unemployment benefits for the week ending October 12th. This report revealed that initial jobless claims fell to 241,000, marking a drop of 19,000 from the revised level of 260,000 the week prior.
Economists had anticipated slight growth in jobless claims, projecting an uptick to 260,000 from the initially reported 258,000 for the previous week.
Meanwhile, the Federal Reserve released data indicating that U.S. industrial production decreased by slightly more than expected in September, dipping by 0.3% after a downwardly adjusted increase of 0.3% in August. Economists had expected a smaller decline of 0.2%, versus the original report of a 0.8% increase for the preceding month.
The dollar index, which spiked to 103.87, later eased to 103.79, though it remained well above the baseline, achieving an approximate gain of 0.2%.
Against the Euro, the dollar appreciated to 1.0832 from 1.0862, in reaction to the European Central Bank’s decision to cut interest rates once more. The ECB lowered key interest rates by 25 basis points as anticipated, with policymakers noting that the disinflation process is progressing, although there are growing concerns regarding the health of the euro area economy following recent disappointing data since the September policy meeting.
The Governing Council, chaired by ECB President Christine Lagarde, reduced the deposit facility rate by a quarter point to 3.25% after the rate-setting meeting conducted in Ljubljana, Slovenia’s capital.
Conversely, the dollar slipped against Pound Sterling, retracting about 0.17% to 1.3011. Against the Japanese yen, the dollar strengthened to 150.23 yen, up from the previous closing rate of 149.64 yen.
The dollar declined against the Australian dollar to 0.6696, compared to Wednesday’s closing figure of 0.6667. The Swiss franc saw a slight decrease to 0.8661 per dollar, while the Canadian dollar weakened to 1.3798 per U.S. currency unit.
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