Forex - Dollar Continues to Enjoy Post-Fed Gains Despite Mixed Economic Data

Published 05/02/2019, 01:22 PM
Updated 05/02/2019, 01:58 PM
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Investing.com - The U.S. dollar inched higher against its rivals on Thursday, adding to its post-Federal Reserve gains from a day earlier despite mixed U.S. economic data.

The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.13% to 97.54.

The Commerce Department said factory goods orders increased 1.9% in March year on year, beating economists' expectations for a 1% rise.

The U.S. Department of Labor reported Thursday that initial jobless claims remained unchanged at 230,000, missing expectations for a decline of 10,000.

The mixed data did little to hurt the dollar, thanks to an ongoing rise in U.S. government bond yields after Fed Chairman Jerome Powell dented investor hopes for a rate cut a day earlier.

Powell said that the current path of monetary policy remains appropriate, arguing that neither a rate cut nor hike was needed, despite ongoing pressure from President Donald Trump for the Fed to slash rates.

GBP/USD fell 0.18% to 1.3028 in a rocky session after the Bank of England left interest rates unchanged, but the bank raised its GDP forecast and kept a future rate hike on the table.

"The MPC suggested that one 25 (basis point) rate hike over the next three years won’t be enough to contain the projected inflation trajectory, but that assumes a soft Brexit," Hedge Fund Economics said in a note.

"We predict investment to be low, growth is likely to be as low or lower than the MPC predicts, and inflation is likely to hold steady below target."

EUR/USD fell 0.15% to $1.1180 as better-than-expected eurozone manufacturing growth was offset by German retail sales that fell short of estimates.

USD/CAD rose 0.19% to C$1.3466 as oil prices added to losses from a day earlier, when the Energy Information Agency revealed a larger-than-expected build in weekly U.S. inventories.

USD/JPY rose 0.12%% to Y111.51.

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