The U.S. dollar surged to a nine-month high on Thursday, as the minutes from the Federal Reserve’s July meeting showed policymakers are considering tapering the bank’s bond purchases prograrm this year.
Worries about the continued surge in coronavirus cases of the Delta variant raised concerns about global economic recovery and pushed up the demand for the safe-haven currency.
A bigger than expected drop in U.S. jobless claims in the week ended August 13 too contributed to dollar’s uptick.
A report released by the Labor Department on Thursday showed a continued decrease in first-time claims for U.S. unemployment benefits in the week ended August 14th.
The report said initial jobless claims fell to 348,000, a decrease of 29,000 from the previous week’s revised level or 377,000. Economists had expected jobless claims to edge down to 363,000 from the 375,000 originally reported for the previous week.
The Conference Board released a separate report on Thursday showing its index of leading U.S. economic indicators increased by slightly more than expected in the month of July. The Conference Board said its leading economic index advanced by 0.9% in July after rising by a downwardly revised 0.5% in June.
Economists had expected the index to climb by 0.8% compared to the 0.7% increase originally reported for the previous month.
The Federal Reserve Bank of Philadelphia also released a report on Thursday showing an unexpected slowdown in the pace of growth in regional manufacturing activity.
The Philly Fed said its diffusion index for current activity slipped to 19.4 in August from 21.9 in July. A positive reading still indicates growth, but economists had been expecting the index to inch up to 23.0.
The dollar index is up nearly 0.5% at 93.58.
Against the Euro, the dollar firmed to $1.1679 from $1.1710.
The Pound Sterling lost ground against the dollar, fetching $1.3638 a unit, more than 0.8% less than previous close of $1.3754.
The Yen is little changed at 109.76 a dollar.
Against the Aussie, the dollar is stronger by nearly 1.2% with the AUD-USD quoting at 0.7149.
The Swiss franc is weaker by about 0.2% against the dollar, at 0.9188. Data from the Federal Customs Administration showed Switzerland’s exports increased in July, rising by a reak 0.6% month-on-month, after a 3% fall in June.
The Loonie has slid to C$1.1826 against the dollar, giving up more than 1.3%, after crude oil prices fell for a sixth successive day amid rising concerns about the outlook for energy demand.