Dollar Takes a Step back After Recent Optimism
The US Index saw a slight progression as the weekly unemployment claims drop below one million for the first time since March.
However, this could not prevent the Index from closing above the 94.00 handle. While the sub-1 million reading marks a milestone, there is still plenty of work to do for the job market to get back to normal.
In addition, US retail sales data released later today will likely show a small setback in July. The flare-up of virus cases and the upcoming expiry of unemployment benefits at the end of the month led consumers to adopt more cautious spending patterns.
The USDJPY pair met resistance at the psychological level of 107.00. Risk appetite may reverse in the coming days as the US-China trade talks are expected to resume.
Eurozone Awaits GDP Data
The euro closed 0.26% higher over the dollar yesterday as the eurozone continued to show further signs of economic recovery.
Added to that, the recent frailties in the dollar concerning indecisive government stimulus talks weighed in on the pair.
With the GDP growth rate figures being released later today, will the EURUSD break past the 1.19 level?
Pound in Buoyant Mood as Recession Reality Sinks In
The pound managed to shake off its recession shackles closing 0.27% over the US dollar. The currency is generally outperforming the majority of its G10 peers signifying significant strength.
The hospitality sector is trying to boost the economy with its half price meal schemes attracting consumers.
UK chief negotiator David Frost said on Thursday that a Brexit agreement can be reached with the European Union in September, adding further positive sentiment.
Australasia Looks Towards Lockdown Again
The Aussie and Kiwi closed negatively against the US dollar on Thursday as both economies received adverse news.
The RBNZ declared that it is willing to cut its interest rates further in the face of uncertainty surrounding the economic recovery. This came as the New Zealand dollar fell against all major currencies.
For the first time in 102 days, the infection rates steadily increased leading to lockdowns.
The Aussie closed 0.15% lower on Thursday. Mixed unemployment data released yesterday meant that the seven-week rally stalled against the US dollar.
Indices Halt but Are Record Highs Inevitable?
The S&P500 was slightly off all time highs trading 0.2% lower on Thursday. Uncertainty remained regarding an agreement over another economic stimulus package.
With certain US stocks at record highs and jobless claims on a downward heading, some US politicians have little incentive to arrive at any sort of new stimulus deal.
The Dow closed 0.10% down as shares of Cisco under performed and fell by 11%.
Bulls Lying in Wait
Gold found new support above $1930 closing 2% higher. With a weakened dollar came a shift in risk appetite as bulls found some footing.
As we continue into the weekend further talks over a US stimulus package will continue to dominate the yellow metal. Can renewed risk appetite push us back to record highs?
WTI Holds Steady
Oil continues to remain above the $42 handle as President Trump unveiled a historic Israel-UAE peace plan.
The fresh five-month high above $43 witnessed in the preceding days indicates no downturn. The continued worries over a second wave of the pandemic are not currently affecting WTI.