Investing.com - The euro rose to eight month highs against the dollar on Thursday, as sentiment on the greenback was hit by expectations that the economic impact of the recent U.S. government shutdown would keep the Federal Reserve from scaling back its stimulus program.
EUR/USD hit 1.3680 during U.S. morning trade, the pair’s highest since February 1; the pair subsequently consolidated at 1.3675, rallying 1.04%.
The pair was likely to find support at 1.3514, the session low and near-term resistance at 1.3710, the high of February 1.
The U.S. Congress passed a bill to reopen the government and raise the debt ceiling on Wednesday, just hours ahead of a deadline to avert a debt sovereign debt default.
The deal will fund the government until January 15 and raise the government borrowing limit until February 7. Both sides also agreed to talks over broad budget issues in an attempt to reach a longer-term deal by December 13.
The dollar came under heavy selling pressure amid fears that the impact of the 16-day shutdown on the already fragile economic recovery would prompt the Fed to delay plans for rolling back its stimulus program until at least the start of next year.
The possibility of another debt crisis also loomed, as the temporary solution does not resolve the underlying budgetary issues dividing Republicans and Democrats.
Meanwhile, the U.S. Department of Labor said Thursday the number of individuals filing for initial jobless benefits last week declined by 15,000 to a seasonally adjusted 358,000 from a downwardly revised 373,000 in the preceding week.
Analysts had expected U.S. jobless claims to decline to 335,000 last week.
A separate report showed that the Philly Fed manufacturing index ticked down to 19.8 from 22.3 in September, but came in above expectations for a reading of 15.0.
Elsewhere, the euro was lower against the pound, with EUR/GBP slipping 0.17% to 0.8468 and was slightly higher against the yen, with EUR/JPY rising 0.15% to 133.82.
Sterling was boosted after data released on Thursday showed that retail sales in the U.K. rose at a faster than expected rate in September.
The Office for National Statistics said U.K. retail sales rose 0.6% from a month earlier, compared to expectations for a 0.4% increase and were 2.2% higher on a year-over-year basis.
EUR/USD hit 1.3680 during U.S. morning trade, the pair’s highest since February 1; the pair subsequently consolidated at 1.3675, rallying 1.04%.
The pair was likely to find support at 1.3514, the session low and near-term resistance at 1.3710, the high of February 1.
The U.S. Congress passed a bill to reopen the government and raise the debt ceiling on Wednesday, just hours ahead of a deadline to avert a debt sovereign debt default.
The deal will fund the government until January 15 and raise the government borrowing limit until February 7. Both sides also agreed to talks over broad budget issues in an attempt to reach a longer-term deal by December 13.
The dollar came under heavy selling pressure amid fears that the impact of the 16-day shutdown on the already fragile economic recovery would prompt the Fed to delay plans for rolling back its stimulus program until at least the start of next year.
The possibility of another debt crisis also loomed, as the temporary solution does not resolve the underlying budgetary issues dividing Republicans and Democrats.
Meanwhile, the U.S. Department of Labor said Thursday the number of individuals filing for initial jobless benefits last week declined by 15,000 to a seasonally adjusted 358,000 from a downwardly revised 373,000 in the preceding week.
Analysts had expected U.S. jobless claims to decline to 335,000 last week.
A separate report showed that the Philly Fed manufacturing index ticked down to 19.8 from 22.3 in September, but came in above expectations for a reading of 15.0.
Elsewhere, the euro was lower against the pound, with EUR/GBP slipping 0.17% to 0.8468 and was slightly higher against the yen, with EUR/JPY rising 0.15% to 133.82.
Sterling was boosted after data released on Thursday showed that retail sales in the U.K. rose at a faster than expected rate in September.
The Office for National Statistics said U.K. retail sales rose 0.6% from a month earlier, compared to expectations for a 0.4% increase and were 2.2% higher on a year-over-year basis.