Dollar Weakens As Rising Yields Spark Rate Hike Concerns
04 October 2018 - 11:56PM
RTTF2
The dollar is losing ground against its major rivals Thursday
afternoon after a recent jump by U.S. treasury yields raised
concerns about the outlook for interest rates. With the ten-year
yield reaching its highest levels in over seven years, traders seem
worried the Federal Reserve may raise rates more aggressively than
currently anticipated.
With the release of the closely watched monthly jobs report
looming, the Labor Department released a report on Thursday showing
a bigger than expected drop in first-time claims for U.S.
unemployment benefits in the week ended September 29th.
The Labor Department said initial jobless claims fell to
207,000, a decrease of 8,000 from the previous week's revised level
of 215,000. Economists had expected jobless claims to edge down to
213,000 from the 214,000 originally reported for the previous
week.
After reporting a pullback in new orders for U.S. manufactured
goods in the previous month, the Commerce Department released a
report on Thursday showing a substantial rebound in factory orders
in the month of August.
The Commerce Department said factory orders surged up by 2.3
percent in August after falling by a revised 0.5 percent in July.
Economists had expected factory orders to jump by 2.1 percent
compared to the 0.8 percent drop originally reported for the
previous month.
The dollar rose to an early high of $1.1463 against the Euro
Thursday, but has since retreated to around $1.1510.
The German construction sector saw a loss of growth momentum in
September, data from IHS Markit revealed Thursday. The construction
Purchasing Managers' Index came in at 50.2 in September, down from
51.5 in August. A score above 50 indicates expansion.
The buck has pulled back to around $1.3015 against the pound
sterling Thursday afternoon, from an early high of $1.2921.
The greenback has dropped to around Y113.765 against the
Japanese Yen Thursday afternoon, from an early high of
Y114.521.
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