Dollar Loses Ground Against Rivals

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The U.S. dollar lost ground against its peers on Wednesday, reacting to a slew of economic data, the latest updates on Brexit trade deal talks, and U.S. fiscal stimulus.

On the stimulus front, President Donald Trump slammed the bill passed by the Congress on Tuesday as a “disgrace.” In a video posted on Twitter, Trump called on Congress to amend the bill to increase the direct payments to individuals to $2,000 from $600 and “get rid of the wasteful and unnecessary items.”

Democrats expressed support for increasing the size of the direct payments, but the idea is likely to face resistance in the Republican-controlled Senate.

The stimulus is attached to a government spending bill that Trump needs to sign by Monday to avoid a government shutdown.

Data from the Labor Department showed initial jobless claims in the U.S. slid to 803,000 in the week ended December 19th, a decrease of 89,000 from the previous week’s revised level of 892,000. Economists had expected jobless claims to come in unchanged compared to the 885,000 originally reported for the previous week.

Data from the Commerce Department showed durable goods orders climbed by 0.9% in November after spiking by an upwardly revised 1.8% in October. Economists had expected durable goods orders to rise by 0.6% compared to the 1.3% jump that had been reported for the previous month.

Another report from Commerce Department said new home sales plunged by 11% to an annual rate of 841,000 in November after sliding by 2.1% to a revised rate of 945,000 in October.

A report released by the University of Michigan on Wednesday showed U.S. consumer sentiment improved by less than initially estimated in the month of December. The report said the consumer sentiment index for December was downwardly revised to 80.7 from the previously reported 81.4.

The dollar index, which dropped to a low of 90.16 around mid morning, recovered some ground subsequently and was last seen at 90.36, down 0.33% from previous close.

Against the Euro, the dollar weakened to $1.2221 earlier in the day, but pared some losses as the session progressed. It was down 0.2% at $1.2184 a little while ago.

The Pound Sterling firmed up against the dollar, fetching $1.3495 a unit, about 1% more than Tuesday’s closing level. The pound was higher against its major counterparts, as France lifted the travel ban on the U.K., allowing travel in limited circumstances, as the border closure caused chaos during the holiday season.

The European Commission on Tuesday urged EU nations to ease travel bans imposed on Britain in order to ensure essential travel and avoid supply chain disruptions.

Meanwhile, on the Brexit front, after resolving a few fair competition issues, negotiators were reportedly dealing with EU fisheries rights in the U.K. waters. According to some sources, the negotiations were in a final phase and an agreement could be reached by Wednesday night.

The Yen firmed up to 103.37 a dollar before easing to 103.54, but was still stronger by about 0.1%. Japan’s leading index rose more than estimated in October, climbing to 94.3 from 93.3 a month earlier, final data from the Cabinet Office showed. In the initial estimate, the reading was 93.8.

The Aussie was up 0.75% against the dollar as the AUD-USD pair rose to 0.7579 from 0.7523.

Against Swiss franc, the dollar shed about 0.12%, fetching CHF 0.8884 a unit, while against the Loonie it was down nearly 0.5% at C$ 1.2848.


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