· The U.S. dollar weakened against the euro and yen on Thursday but stayed near recent highs as investors evaluated the impact of a global government bond rout that has lifted benchmark U.S. Treasury yields to seven-year peaks.
· The combination of strong data and hawkish comments sent the dollar index up to 96.1, its highest since Aug. 20 and nearing a 2018 high of 96.99 hit in mid-August before it gave up gains and turned lower on the day at 95.79.
· Strong economic data and hawkish speeches by Federal Reserve officials, including Chairman Jerome Powell, spooked investors on Wednesday and caused U.S. Treasury yields and the euro/dollar currency pair to breach key technical levels.
· The dollar has outperformed on strong U.S. growth while economic data in other large economies, including the eurozone, has come in below expectations.
· Investors are watching for signs of increasing U.S. inflation as companies, including Amazon, raise minimum wages, and after jobs data last month showed that wages notched their largest annual increase in August in more than nine years.
· U.S. jobs data on Friday for September will give new indications of wage growth and labor market strength.
· The yen weakened to 114.54 yen against the dollar earlier on Thursday, its lowest in 11 months, before retracing to 113.79.
· The euro also recovered from six-week lows against the dollar, after breaching technical support at around $1.15 on Wednesday.
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· Yields on benchmark 10-year U.S. Treasury yields jumped nearly 12 basis points on Wednesday to 3.23 percent, its highest level since mid-2011 after private payrolls data was stronger than forecasts.
· Thursday’s data, which showed jobless claims fell to a near 49-year low, followed comments this week from several Federal Reserve officials, including Chairman Jerome Powell, that underscored the strength of the economy.
· President Donald Trump will sign a bill on Friday granting the U.S. government new powers to shoot down threatening drones and creating new consumer protections for airline passengers, officials said on Thursday.
Trump is set to sign the bill on Friday that will, among other measures, bar airlines from removing seated passengers and require the Federal Aviation Administration (FAA) to write new rules to allow commercial drones to deliver packages.
· The United States on Thursday imposed sanctions against a Turkish-based company, its top directors, and a North Korean diplomat, accusing them of trading in weapons and luxury goods with Pyongyang in violation of international sanctions.
The U.S. Treasury said in a statement that SIA Falcon International Group, which also has a branch in Latvia, would be blacklisted for exporting weapons into or from North Korea.
· Scotland’s Court of Session said on Thursday it has asked the European Court of Justice (ECJ) for a preliminary ruling on whether the British parliament can change its mind about leaving the European Union without the bloc’s agreement.
· European Union negotiators see the outline of a compromise on the Irish border issue which is holding up Brexit talks, EU sources told Reuters on Thursday, raising hopes that a new British offer could unlock a deal.
· Japan’s household spending unexpectedly jumped in August from a year earlier to mark a second month of gains, suggesting a tight job market and steady economic expansion are boosting households’ purchasing power.
· Oil prices fell on Thursday as the prospect of increased crude production from Saudi Arabia and Russia prompted profit-taking the day after futures hit four-year highs on a boost from imminent U.S. sanctions on OPEC’s No. 3 producer Iran.
Brent crude LCOc1 futures fell $1.71, or 1.98 percent, to settle at $84.58 a barrel. On Wednesday, Brent rose to a late 2014 high of $86.74.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell $2.08 to settle at $74.33 a barrel, a 2.72 percent loss.
Reference: Reuters, CNBC
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