Dollar Stays Firm Against Major Rivals On Strong Data

(RTTNews) - The U.S. dollar climbed higher on Thursday, extending gains from the previous session, as strong economic data and comments from Federal Reserve Chair Jerome Powell raised rate hike prospects.

Data from the Labor Department showed initial jobless claims fell to 239,000 in the week ended 24th, a decrease of 26,000 from the previous week's revised level of 265,000. Economists had expected jobless claims to rise to 270,000 from the 264,000 originally reported for the previous week.

A separate report released by the Commerce Department showed the U.S. economy grew by much more than previously estimated in the first quarter of 2023.

The Commerce Department said gross domestic product jumped by 2% in the first quarter compared to the previously estimated 1.3% increase. Economists had expected the pace of GDP growth to be unrevised.

Federal Reserve Chair Jerome Powell said on Thursday that the US central bank would deliver more interest rates hikes by the end of the year in its prolonged fight against high inflation.

"Inflation pressures continue to run high, and the process of getting inflation back down to 2% has a long way to go," Powell said in a speech at the Banco de Espana conference on financial stability in Madrid, Spain.

Powell had said at the ECB forum in Sintra, Portugal on Wednesday that there was "more restriction coming" and successive rate rises were not off the table.

The dollar index, which weakened to 102.78 in the European session, rallied after the release of jobless claims and GDP data, rising to 103.44. The index was last seen at 103.35, gaining nearly 0.5%.

Against the Euro, the dollar firmed to 1.0873 from 1.0914, and strengthened to 1.2615 against Pound Sterling, edging up from 1.2636.

Against the Japanese currency, the dollar is strong, fetching 144.82 yen a unit, nearly 0.25% more than the previous close of 144.49 yen.

The dollar is weak against the Aussie at 0.6617. The Swiss franc is weak at CHF 0.8996 against the dollar, while the Loonie is up slightly at C$ 1.3254 a dollar.