Forex – U.S. Dollar Rises as Upbeat Jobless Claims Trump GDP Slowdown

© Reuters. – The greenback jumped on Thursday, as a drop in the number of people applying for unemployment helped lift sentiment despite a downward revision to economic growth in the fourth quarter.

The , which measures the greenback’s strength against a basket of six major currencies, jumped 0.5% to 96.748 as of 10:20 AM ET (14:20 GMT).

fell to their lowest level in two months last week, offsetting a downward revision to fourth-quarter growth.

Growth slowed to an annualized rate of 2.2% in the last three months of the year, less than the 2.6% originally reported.

The jobless claims news helped take back up to around 2.40%, well off their overnight low of 2.35%. Higher yields make dollar-denominated assets more attractive, supporting demand for the currency.

The dollar rose 0.2% against the safe-haven to 110.74.

The pound, meanwhile, slumped in the wake of the U.K. parliament’s failure to pass any bills that were alternatives to Prime Minister Theresa May’s Brexit agreement. May is still hoping to bring back her Withdrawal Agreement for a third vote on Friday, and has promised to resign if her deal passes, to allow a more committed Brexiteer to oversee talks on the U.K.’s future trade relationship with the EU. was down 0.7% to 1.3094.

Meanwhile the Turkish authorities continued to struggle to defend the against heavy selling ahead of municipal elections at the weekend. The dollar rose as far as 5.6245 lira in early trading in Europe, a gain of over 5%, before retracing later to 5.5511. That’s still up over 4% on the day.

Neil Mellor, senior currency strategist with BNY Mellon, said in a note to clients that the lira’s slide had appeared to be the catalyst for weakness in other emerging currencies on Wednesday, such as the , the and the . The real and peso have, however, each recouped around 1% against the dollar so far on Thursday.

Elsewhere, the loonie was down, with rising 0.1% to 1.3420, while hit a two-week low of $1.1215 on hints of further stimulus from the European Central Bank, before recovering to $1.1224.

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