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The ‘Greenback’ has weakened for a second day against the Japanese Yen due to speculation by traders that the US economy may not be strong enough for the US Federal Reserve’s policy makers to start tapering the Central Bank’s stimulus programme. The currency is likely to make some gains against the Euro and recover some ground against Sterling if this afternoon’s jobless claims data shows a reduction in the number of people claiming job seeker benefits.
The Pound reached its highest-level in seven months against the US Dollar as investors wait to see what Bank of England Governor Mark Carney will say when he testifies to the Parliamentary Treasury Committee later in the session. The currency found strong support from data which showed that the unemployment rate in the UK fell to 7.7% in the second quarter of the year.
The Euro is holding steady at a two-week high against the US Dollar as the US currency continues to be weighed down by last week’s disappointing jobs data and the weakening demand for safe havens. The single currency found support after the Netherlands posted stronger than expected retail sales data.
The ‘Aussie’ weakened against all of its most traded counterparts after data showed that unemployment in the country climbed to a four-year high. The surprising data caused the currency to tumble against the US Dollar and saw it retreat from its strongest level in two months.
New Zealand Dollar
The ‘Kiwi’ has advanced for a fifth day against the US Dollar and reached its highest level in more than three-weeks, after the nation’s Central Bank signalled that it may raise interest rates from a record low earlier than expected.
The Canadian Dollar remains little moved against its US relation. The ‘Loonie’ received support from the increased demand for riskier assets as the risk of US led military action against Syria diminished. The commodity based currency also benefitted from an increase in the value of commodities such as iron ore and other metals.
South African Rand
The Rand recovered against its major peers and rose close to four-week highs against the US Dollar after the currency found support from better-than-expected manufacturing data. According to Statistics South Africa, manufacturing production in the country rose by 5.4% year-on-year in July, up from the revised figure of 0.5%. On a month-by-month basis, output smashed forecasts of a rise of 3.37% and soundly improved on the previous months reading of -3.0%.