Forex - U.S. Dollar Flat as Philly Fed Index Jumps to 1-Year High
18/07/2019 14:32:57 Forex
The U.S. dollar was flat on Thursday after data showing that business activity in the Mid-Atlantic jumped to its strongest level in a year.The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was unchanged at 96.850 by 10:32 AM ET (14:32 GMT).The Philadelphia Federal Reserve said its business index rose to 21.8 in July, the highest level since July 2018. A figure above zero suggests the region's business activity is growing.Meanwhile a separate report showed that while unemployment claims rose slightly last week, the labor market still remained strong. Initial jobless claims rose 8,000 to a seasonally adjusted 216,000 for the week ended July 13, the Labor Department said, while data for the prior week was revised down by 1,000.Taken together, the data add little to arguments for the half-point cut in interest rates that some still expect from the Federal Reserve at the end of the month. The dollar did give up some of its recent gains against the British pound after U.K. lawmakers approved an amendment that would make it harder for the next Prime Minister to suspend parliament in order to force through Brexit on Oct. 31. The amendment would require parliament to be sitting to consider Northern Irish affairs for several days in September and October even if it was suspended. Sterling rose as high as $1.2495 on the news, after having traded below $1.24 for the first time in two years earlier this week. By 10:50 AM ET (1450 GMT), it was up 0.4% on the day at $1.2480. Lawmakers backed a proposal by 315 to 274 that would require parliament to be sitting to consider Northern Irish affairs for several days in September and October even if it was suspended.Elsewhere, traders pushed the rand higher after the South African Reserve Bank cut its key interest rate by 25 basis points to 6.5% and cut its growth forecast to 2019 to a mere 0.6%. The dollar fell 0.7% against the rand to test a new seven-month low at below 13.8900.That followed an interest rate earlier in the day by the central bank of South Korea, after which the won strengthened some 0.2%.Ongoing trade disputes between the U.S. and China also weighed on the dollar. The Wall Street Journal reported that the two have stalled on progress towards a deal over disputes on how to ease restrictions on Chinese tech giant Huawei. Elsewhere, EUR/USD was flat at 1.1221, while USD/CAD gained 0.2% to 1.3075.