Canadian dollar – Despite a report showing that the monthly growth rate for the economy was unchanged through April the Canadian dollar advanced. The warmer risk waters made sure of that and besides, economists had predicted a minor decline for GDP output following the Japanese turmoil one month earlier. The unchanged reading means the Canadian economy grew at an annualized 2.8% pace led by a jump in metal ore and coal mining. The government said that retail and wholesale trade also rose. The loonie advanced to $1.0350 U.S. cents and the highest level in three weeks after the reading.
U.S. Dollar – Relief for Greece and with hopes running high for a bond settlement to be announced in Berlin, the dollar is still feeling heavy. Its index shed almost another 0.5% on Thursday and appetite for the dollar was further dulled by a sloppy reading for weekly initial claims. The jobless count eased by a mere 1,000 to 428,000 claimants but not only did the reading of continuous claims come in higher than forecast, but previously recorded data was also revised higher. The likely rate increase in Europe next week is also playing a role in maintaining a depressed dollar in the sudden absence of negative economic commentary.
Aussie dollar – The Aussie continued its rise as European tensions eased while a boost in credit during May helped remind dealers that the economy has been in decent shape. The Aussie traded to as high as $1.0750 U.S. cents after private sector credit rebounded by 0.3% last month leaving the annual pace of expansion at 3.1%.
Japanese yen – The yen rebounded against the dollar again overnight following strengthening reports on construction. Japanese housing starts increased by 6.4% year-on-year in May from a virtual standstill in April. Meanwhile construction orders were 25% higher in May than a year ago. The yen strengthened pushing the dollar down to ¥80.31.
Andrew Wilkinson is a Senior Market Analyst at Interactive Brokers LLC
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