The US Dollar has fallen more than 1% against the Pound as investors assess the impact of the US government shutdown and as jobless claims fell less than expected.
Relief over the deal to re-open the federal government and raise the debt ceiling was quickly replaced with concerns over the shutdowns impact on the economy and the possibility for a repeat performance of the last two weeks antics in January and February 2014.
After the deal was reached the Dollar initially made gains against its peers but fears grew that the impact of the shutdown could have had a negative effect on the recovery of the world’s largest economy.
The Dollar then fell against the Pound and the majority of its most traded peers as investors increased their bets that the Federal Reserve will refrain from tapering its monetary easing policy and delay a cut until next year. As a result the higher yielding currencies of the Australian and New Zealand Dollars as well as the Indian Rupee and Rand benefitted.
“The market is getting grumpy with the Dollar. It is going through the throes of thinking, can the Fed taper this year? It’s starting to look less likely” said David Bloom, head of global currency strategy at HSBC Holdings Plc in an interview with Bloomberg.
As Thursday’s European session progressed the ‘Greenback’ came under further pressure after the Chinese ratings agency Dagong cut its sovereign debt rating for the USA and after US jobless claims data came in below expectations.
According to the Washington based Labour Department, the number of US citizens claiming unemployment benefits fell by 15,000 to 358,000 in the week ending October 12th. Economists had been expecting a fall to 335,000. The reason for the higher figure is thought to be a result of the government shutdown and as California works through a backlog of applications.
US Dollar (USD) Current Exchange Rates
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6224
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7338
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0300
The US Dollar/ Australian Dollar Exchange Rate is currently in the region of: 1.0431
The US Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1818
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 97.9252
The US Dollar/ South African Rand Exchange Rate is currently in the region of: 9.8526
The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.6064
The Euro/ US Dollar Exchange Rate is currently in the region of: 1.3535
(Correct as of 14:40 pm GMT)
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