Investing.com - The dollar firmed against most of the world's major currencies on Thursday, as fresh potholes stopping Greece from tapping bailout funds coupled with surprisingly high inflation rates in China sent investors snapping up greenbacks.
In early Asian trading on Thursday, EUR/USD fell 0.04% to 1.3256.
Greece is seeking EUR130 billion in assistance funding to avoid a messy default in March.
To get that money, the country must restructure its debts with private creditors as well as agree to austerity measures from multilateral lenders.
Multilateral organizations such as the International Monetary Fund, the European Union and the European Central Bank are demanding that Greece agree to politically unpopular austerity measures such as payroll cuts and pension reforms in exchange for bailout money, and the country is close to accepting terms.
Reports emerged, however, that Athens has agreed to slash public-sector payrolls, but some in the country's ruling coalition balked at pension reforms, thus throwing a formal agreement into delay anew.
Furthermore, China's annual inflation rate came in higher than expected, climbing 4.5% in January, well above market expectations for a 4.0% gain.
Economists attributed the increase to seasonal factors but stressed Chinese price stability merited scrutiny going forward.
Traders said uncertainty made the greenback the most attractive option out there Thursday, as the euro risks further weakening the longer Greece goes without a deal to access its emergency funds.
"There’s lots of potential for investors to pull out more worry bids," said Besa Deda, chief economist at St. George Bank Ltd. in Sydney, according to Bloomberg.
"I still like a lower euro in the next few months, possibly under $1.30."
Meanwhile in New Zealand, the unemployment rate hit a seasonally adjusted 6.3% in the fourth quarter of last year compared to 6.6% in the preceding quarter.
Analysts had expected an unemployment rate to come to 6.5% in the last quarter.
Meanwhile, the dollar was steady against the pound, with Cable down 0.02% to hit 1.5816.
The greenback was up 0.15% against the yen, with USD/JPY trading at 77.15, and up against the Swiss franc, with USD/CHF rising 0.06% to 0.9130.
The greenback was mixed against its counterparts in Canada, Australia and New Zealand, with USD/CAD down 0.01% at 0.9960, AUD/USD down 0.14% at 1.0784 and NZD/USD down 0.04% at 0.8348.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.01% at 78.73.
Later Thursday, Japan is to release government data on core machinery orders, a key gauge of production.
The U.K. will release official data on manufacturing output as well as figures on the country’s trade balance.
The U.K. National Institute of Economic and Social Research is to publish its monthly estimate on gross domestic product.
Also Thursday, the Bank of England is to announce its plans for benchmark interest rates.
The ECB is also to announce set to address benchmark interest rates as well, followed by a press conference.
The conference will draw close market scrutiny, as the world will be keen on language hinting at a need for new monetary measures to counter the region’s sovereign debt crisis.
Later in the day, the U.S. is to publish government data on initial jobless claims, a key signal of overall economic health.
In early Asian trading on Thursday, EUR/USD fell 0.04% to 1.3256.
Greece is seeking EUR130 billion in assistance funding to avoid a messy default in March.
To get that money, the country must restructure its debts with private creditors as well as agree to austerity measures from multilateral lenders.
Multilateral organizations such as the International Monetary Fund, the European Union and the European Central Bank are demanding that Greece agree to politically unpopular austerity measures such as payroll cuts and pension reforms in exchange for bailout money, and the country is close to accepting terms.
Reports emerged, however, that Athens has agreed to slash public-sector payrolls, but some in the country's ruling coalition balked at pension reforms, thus throwing a formal agreement into delay anew.
Furthermore, China's annual inflation rate came in higher than expected, climbing 4.5% in January, well above market expectations for a 4.0% gain.
Economists attributed the increase to seasonal factors but stressed Chinese price stability merited scrutiny going forward.
Traders said uncertainty made the greenback the most attractive option out there Thursday, as the euro risks further weakening the longer Greece goes without a deal to access its emergency funds.
"There’s lots of potential for investors to pull out more worry bids," said Besa Deda, chief economist at St. George Bank Ltd. in Sydney, according to Bloomberg.
"I still like a lower euro in the next few months, possibly under $1.30."
Meanwhile in New Zealand, the unemployment rate hit a seasonally adjusted 6.3% in the fourth quarter of last year compared to 6.6% in the preceding quarter.
Analysts had expected an unemployment rate to come to 6.5% in the last quarter.
Meanwhile, the dollar was steady against the pound, with Cable down 0.02% to hit 1.5816.
The greenback was up 0.15% against the yen, with USD/JPY trading at 77.15, and up against the Swiss franc, with USD/CHF rising 0.06% to 0.9130.
The greenback was mixed against its counterparts in Canada, Australia and New Zealand, with USD/CAD down 0.01% at 0.9960, AUD/USD down 0.14% at 1.0784 and NZD/USD down 0.04% at 0.8348.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.01% at 78.73.
Later Thursday, Japan is to release government data on core machinery orders, a key gauge of production.
The U.K. will release official data on manufacturing output as well as figures on the country’s trade balance.
The U.K. National Institute of Economic and Social Research is to publish its monthly estimate on gross domestic product.
Also Thursday, the Bank of England is to announce its plans for benchmark interest rates.
The ECB is also to announce set to address benchmark interest rates as well, followed by a press conference.
The conference will draw close market scrutiny, as the world will be keen on language hinting at a need for new monetary measures to counter the region’s sovereign debt crisis.
Later in the day, the U.S. is to publish government data on initial jobless claims, a key signal of overall economic health.