Statistics from the U.S. Department of Labor showed that the number of individuals filing for initial jobless claims rose by 7,000 to 265,0000 in the week ending March 12th, compared to the previous week’s figure of 258,000. Economists anticipated the number of people applying for unemployment benefits to increase by 10,000 to 268,000.
The Federal Reserve Bank of Philadelphia indicated that its manufacturing index ticked up to 12.4 in March, from the previous month’s reading of -2.8. The media estimate expected the index to advance only to -1.7.
However, the FOMC’s decision to leave monetary policy unchanged, while sharing its projection to hike rates only two times in 2016 instead of four, as initially estimated, continued to weigh on the dollar.
In the eurozone, official statistics revealed that the consumer price index went up by 0.2% last month, surpassing expectations for a rise of 0.1%. On a year over year basis, consumer prices declined 0.2% in February. Core CPI increased by 0.4% in the same month, following a 1.7% fall in January. As a result, the euro advanced 0.51% against the dollar at 1.1283.
The greenback was also lower against the sterling, with GBP/USD higher 0.74% at 1.4366. The Bank of England left its benchmark interest rate at 0.50%, in a widely anticipated decision. The rate has been held unchanged since March 2009. The BoE also stated it was maintaining the asset purchases programme at £375 billion.
The dollar ticked down against the Swiss franc and the Japanese yen as well, with USD/CHF losing 0.66 to 0.9702, and the USD/JPY dropping 0.96% to 111.49. The Swiss National Bank announced earlier in the day its decision to leave its deposit rate unchanged at -0.75%. The bank also stated that it would continue to intervene towards the weakening of the Swiss franc, as it remains ‘significantly overvalued’.
Elsewhere, the Australian dollar was up against its U.S. counterpart, with AUD/USD gaining 0.56% at 0.7594, after data showed that the number of employed individuals increased by 300 last month, well below expectations for a 10,000 increase. Nevertheless, Australia’s unemployment rate went down to 7.8% in February from 6.0% a month before.
The New Zealand dollar was also up, with NZD/USD rallying 1.22% to trade at 0.6805. The Kiwi was strengthened after official data from New Zealand showed that the gross domestic product advanced by 0.9% in Q4, surpassing forecasts for a 0.6% rise. On a year over year basis, the country’s GDP increased by 2.3% in the same quarter, against expectations for a 2.0% rise. The greenback was also lower 0.50% against the Canadian dollar at 1.3035.
The U.S. dollar index which tracks the greenback’s performance against a group of six other currencies fell 0.65% to 95.08, after reaching a five-month bottom of 94.70 earlier in the day.