Posted April 01, 2010
US dollar improves against some but not all currencies. The euro holds strong and gains.
In the currency markets on Thursday, the US dollar managed to rise above the Japanese yen to levels not seen in seven months. Data from the US government turned currency traders bullish. However, the dollar did struggle against the euro as investors began to turn back to it as a lucrative investment.
A variety of factors affected the US currency during Thursday trading. The dollar moved up to 93.87 against the yen, which is an increase of about 0.3 percent. It hit as high as 94.01 in early day trading. That was the highest the currency rose since August 26, 2009. The dollar index quotes showed that the US dollar fell to 80.719. This is the measurement of the US currency against six other major currencies. It stood at 81.062 in Wednesday trading.
The euro moved from $1.3512 in late Wednesday trading to $1.3584 at the end of the day Thursday. Also important, the British pound moved to $1.5288, which is an increase of 0.7 percent.
The euro fell to all time lows against the Swiss franc in trading on Thursday. It moved below 1.4200 francs to 1.4323. Key information out which is rumor at this point, saw that the Swiss central bank is likely to intervene. That news comes from Action Economics.
The yen also saw a bit of support in trading. That was due to the Bank of Japan’s quarterly survey of business sentiment in the country. The survey showed that businesses are less pessimistic about the nation’s largest companies.
Also, the US dollar moved up 0.6 percent against the New Zealand dollar. One of the key factors here was an announcement by the International Monetary Fund which reported that the nation’s currency was overvalued by as much as 25 percent.
The Australian dollar moved up as much as one percent in trading against the New Zealand dollar.
Economic Data Due Out
Thursday’s currency trading was hampered slightly by the economic data that is expected out on Friday. The data is likely to give traders an idea of where there next move is, with most looking for opportunities to see US economic growth to be strong during the month of March. Wednesday brought news that the private employment numbers were less than what was expected by analysts. This alone seemed to hold back investors and it dampened their homes for a big jump in the number of payrolls in the report due out Friday.
Risk And Reward
The current currency climate has the US currency back to where it normally is, in a situation where the economic data of the country seems to turn heads more so. Investors risk appetite seems linked to this data.
The US dollar improved when the Labor Department announced that 439,000 Americans filed initial jobless claims. That was down by about 6000 from the week before. Still, investors expect that the US economy will grow faster than that of most other countries, especially Japan.