At the time of writing the U.S dollar index which measures the Greenbacks strength against a trade weighted basket of currencies is up 0.60% at 95.61. As a risk averse tone persisted in the markets for a second consecutive session and the U.S dollar has been well supported despite a mixed bag of data out of the States. Initial jobless claims for the week ending August 4th declined to 213k, from 219k which adds evidence of a healthy labour market. Producer Prices were flat for the month of July, markets were expecting a 0.20% increase.
Out the G10 currencies, the AUD and NZD have been hardest hit. AUD/USD lost 1% on Thursday, falling from 0.7445 down to 0.7370. The Kiwi has shed over 2% dropping from 0.6758 down to 0.6610 after the RBNZ assistant Governor John McDermott suggested the chances of a rate cut had increased. EUR/USD down 0.8% on the day buying 1.1526 and the Pound down at 1.2825 with lingering concerns of a no-deal on Brexit.
In other news, the Turkish Lira has hit record lows against the USD after a Turkish delegation returned from meeting US officials in Washington with no apparent solution to a diplomatic rift that has opened up between them. The Lira stands at 5.5453 vs the USD which is an all-time low.
Looking ahead, US CPI for July is due out and we are expecting no change to the headline figure at 2.3%.