Thursday, 11 Mar 2010

Dollar Up After U.S. Unemployment Claims and Trade Balance

The U.S dollar climbed against a basket of currencies after the release of last week's U.S. unemployment claims. New unemployment claims increased to 462K on expectations of 456K. However, the U.S. Trade Balance posted a smaller than expected increase, coming in at -37.3B on forecasts of -40.9B. This helped to push the EUR/USD lower to the level of 1.3531 after opening the New York trading session at 1.3661.

The dollar fell against the Yen as China's stronger-than-expected price data stoked concerns regarding further potential monetary tightening measures in China, prompting investors to dump the U.S. currency for the safe-haven yen. The greenback weakened against its Japanese counterpart, falling to 90.35 yen from 90.55 yen in late trading Wednesday.

The greenback may continue to strengthen after the dollar positive trade balance data. A price target for the EUR/USD may be the 1.3578 support level