US Labor Market Resilience Lifts Dollar Value

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The dollar index (DXY) rose by +0.22% today following a decline in weekly initial unemployment claims, which unexpectedly fell by 5,000 to 227,000—an 8-week low, contrasting with estimates predicting an increase to 235,000. Conversely, continuing claims climbed by 10,000 to 1.965 million, marking a 3.5-year high.

The euro (EUR/USD) dropped -0.29% to a 2-week low, influenced by the stronger dollar and negative Eurozone economic news, particularly a -0.7% month-over-month contraction in Italy’s May industrial production, exceeding expectations of -0.2%. Meanwhile, the yen (USD/JPY) increased by +0.21%, pressured by Japan’s June Producer Price Index, which eased to +2.9% year-over-year, the slowest increase in 10 months, and concerns regarding the upcoming Japanese upper house election.

In commodities, August gold rose +0.22% while September silver increased by +1.11%. Demand for safe-haven assets has surged amid economic uncertainty, despite a stronger dollar and higher T-note yields tempering gains.

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