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Dollar extends gains on jobless claims data, Fed language

Published 12/19/2014, 03:47 PM
Dollar climbs as market preps for 2015 rate hikes
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Investing.com - The dollar traded higher against most major currencies on Friday in subdued trading after falling jobless assistance claims and reassurances from the Federal Reserve this week continued to stoke expectations for rate hikes in 2015.

In U.S. trading on Friday, EUR/USD was down 0.49% at 1.2226.

The dollar enjoyed support after the U.S. Department of Labor said on Thursday that the number of individuals filing for initial jobless benefits in the week ending Dec. 12 fell by 6,000 to 289,000 from the previous week’s revised total of 295,000. Economist had forecast an increase of 1,000.

The data came a day after the Fed said it would be "patient" before raising rates, guidance which it said is consistent with earlier assurances statement that rates would stay low "for a considerable time."

Fed Chair Janet Yellen said the central bank was unlikely to raise rates for the "next couple of meetings" indicating that a move in April at the earliest is possible.

Still, the dollar saw support on the notion that the days of rock-bottom interest rates are coming to an end.

Meanwhile in Europe, data released earlier revealed that the Gfk German consumer climate index rose to a six-month high of 9.0 in December from a reading of 8.7 the previous month. Analysts had expected the index to tick up to 8.9 this month.

The dollar was up against the yen, with USD/JPY up 0.62% at 119.58, and up against the Swiss franc, with USD/CHF up 0.43% at 0.9841.

The greenback was up against the pound, with GBP/USD down 0.20% at 1.5639.

The Office for National Statistics reported earlier that U.K. public sector net borrowing rose by £13.41 billion last month compared to expectations for an increase of £15.37 billion.

Separately, the Confederation of British Industry said its index of realized sales climbed to a 26-year high of 61 this month from 27 in November, blowing bast expectations for an increase to 30.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.20% at 1.1602, AUD/USD down 0.19% at 0.8148 and NZD/USD down 0.13% at 0.7752.

The US dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.44% at 89.84.

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