The US dollar fell to a four-month low against other major currencies on Friday, as US economic reports on Thursday continued to effect on the dollar as investors looked to release major retail and inflation data in the US later in the day. The USD was under pressure after the US Labor Department reported on Thursday that initial jobless claims rose to 261,000 last week, while expectations were for a drop to 246,000. A separate report also showed that the Producer Price Index fell last month, whereas expectations were for a 0.2% rise.
The greenback gained earlier in the day after China’s foreign exchange regulator declared that the Chinese reports that Beijing would slow down or stop buying US bonds could be based on false information and could be fake. Bloomberg had previously declared, earlier this week, that Chinese officials reviewing foreign exchange holdings had recommended a slowdown or a halt of the purchasing of US bonds. China is the largest foreign holder of US government debt.
The dollar index, which measures the strength of the greenback versus a basket of six major currencies, fell by 0.55%, reaching 91.16 points. Both the euro and the pound were higher than the dollar, with EUR / USD trading up 0.77% to hit 1.2125. The GBP / USD pair traded up 0.54% to hit 1.3611. The European single currency remained strong after the ECB declared that the gradual shift in guidance could be considered since early 2018, according to the minutes of the December meeting.
Both the Japanese yen and the Swiss franc rose against the dollar, with the yen trading down 0.15% to 111.11 yen per dollar. The USD/CHF fell by 0.47%, hitting 0.9712. On another note, the Australian dollar remained weak against the USD, as the AUD/USD was down by 0.18%, at 0.7878. Meanwhile, the New Zealand dollar remained steady against the USD, trading at $0.7257.
Official data showed earlier that China’s exports for December rose by 10.9%, more than expected, while imports rose by 4.5% only, compared with expectations of a rise of 13.0%. China is Australia’s largest export partner and the second largest export partner of New Zealand.
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