Dollar Moves Higher In Spite of Mixed U.S. Ecomic Data

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On Thursday, the greenback pushed higher compared to the other major currencies, in spite of the release of mixed U.S. economic reports,  as expectations for a rate hike later this year persisted high.

The U.S. dollar index, which gauges the greenback’s strength against a trade weighted basket of six major currencies, increase to 98.71, not far from Tuesday’s nine month peak of 99.09.

So far this month, the index has rallied 3.4% as hawkish remarks by Federal Reserve representatives in recent weeks cemented anticipations for a December rate hike.

Statistics on Thursday presented that U.S. orders for long lasting manufactured goods drop a little in September.

Total durable goods order, which include transportation items, decline 0.1% the previous month, the Commerce Department stated.

But excluding defense spending, durable goods orders increase by 0.7%. Stripping out transportation, orders  increase 0.2 percent.

Core capital goods orders, observed as a key measure of business investment fell 1.2% the previous month, the biggest decline since February and were down 4.1% on a yearly basis.

A separate report presented that the number of Americans filing for redundancy benefits drop by 3,000 to 258,000 the previous week, directing to sustained labor market strong point and firming economic development.

The reports came as investors were turning their focus to Friday’s data on U.S. 3rd quarter development, which is anticipated to present an important rally from the 2nd quarter.

Investors are currently pricing in a 71.4% probability of a rate hike at the Fed’s December meeting, according to the reports.

Expectations for higher interest rates normally increase the greenback by making the currency more striking to yield seeking investors.

Sterling was lower in spite of data on 3rd quarter development  showing that the U.K economy shrugged off the immediate shock of the June 23 Brexit referendum.

GBP/USD initially moved highs of 1.2271 before dropping to 1.2176.

Britain’s service sector, which makes up three quarters of the economy, extended in the three months to September, but activity in other sectors contracted.

In the meantime, the greenback hit fresh three month peaks compared to the yen, with USD/JPY increase 0.4% to 104.89.

The euro was slightly higher, with EUR/USD last at 1.0917.

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