Dollar surges, gold adds to losses as jobless claims in U.S. hold near 15-year lows
On Thursday the dollar turned broadly higher against its rivals, after data showed that the number of Americans filing new claims for unemployment benefits rose marginally last week, staying near a 15-year low in a sign that the labor market continues to strengthen despite moderate economic growth.
Meanwhile, gold dropped on Thursday with analysts blaming the fall in the yellow metals prices on rising yields on the 10-year Treasury note. Losses also grew a little after a stronger-than-anticipated report on weekly jobless claims.
The Labor Department said on Thursday that initial claims for state unemployment
benefits rose 3,000 to a seasonally adjusted 265,000 for the week ended
May 2. Claims
for the prior week were unrevised at 262,000, which was the lowest
reading since April 2000. Claims have been below 300,000 for nine weeks - the threshold which is usually associated with a strengthening labor market, Reuters says.
Economists polled by
Reuters had forecast claims rising to 280,000 last week while a U.S. Labor
Department analyst said there was nothing unusual in the state-level
data.
Currency pairs
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.42% to 94.59, off lows of 93.97.
EUR/USD dropped 0.70% to 1.1270, pulling away from two-and-a-half month highs of 1.1392 hit earlier in the session.
Earlier Thursday, official data showed that German factory orders rose 0.9% in March, disappointing expectations for an increase of 1.5%, after a 0.9% fall the previous month.
The pound pushed lower, with GBP/USD shedding 0.21% to 1.5215 as investors remained cautious amid Thursday's U.K. elections which were widely expected to result in a hung parliament and an unstable coalition government.
Elsewhere, the dollar was lower against the yen, with USD/JPY down 0.10% to 119.31 and fractionally higher against the Swiss franc, with USD/CHF adding 0.08% to 0.9171.
The Swiss National Bank reported on Thursday that its foreign currency reserves slipped to 521.9 billion Swiss francs last month from 522.4 billion Swiss francs in March, whose figure was revised from a previously estimated 522.3 billion Swiss francs.
The Aussie and Kiwi were lower, with AUD/USD down 0.24% to 0.7952 and NZD/USD sliding 0.28% to 0.7476.
The Australian Bureau of Statistics earlier said that the number of employed people declined by 2,900 in April, compared to expectations for an increase of 5,000. The change in the number of employed people in March was revised to a 48,200 gain from a previously estimated 37,700 rise. The report also showed that Australia's unemployment rate rose to 6.2% last month from 6.1% in March, in line with expectations.
In Canada, official numbers showed that Canadian building permits increased by 11.6% in March, beating expectations for a 2.5% rise. The change in building permits in February was revised to a 0.3% slip from a previously estimated 0.9% fall. USD/CAD rose 0.32% to trade at 1.2084
Gold
Gold futures dropped Thursday, with analysts blaming
the fall in the precious metal prices on rising yields on the 10-year
Treasury note. A
stronger-than-anticipated report on weekly jobless claims also pressed the metal.
Higher yields in Treasury bonds can make gold look less attractive because the precious metal doesn’t offer a yield.
Gold for June delivery was last down $9.90, or 0.8%, to settle at $1,180.40 an ounce, after settling modestly lower on Wednesday, while July silver fell 27 cents, or 1.6%, $16.24 an ounce.
In other metals trading, July platinum fell by $8.90, or 0.8%, to
$1,133.90 an ounce, while June palladium gave up 45 cents, or 0.1%, to
$792.20 an ounce. July copper shed a penny to $2.92 a pound, MarketWatch reported.
