Dollar climbs broadly on upbeat U.S. data and hawkish Fed's Harker comments: Sept 06, 2017

Market Review - 05/10/2017  22:28GMT 

Dollar climbs broadly on upbeat U.S. data and hawkish Fed's Harker comments

The greenback gained against majority of its peers on Thursday except against the yen as upbeat U.S. data and comments from Federal Reserve officials boosted case for a December rate hike.  

In a report, the U.S. Census Bureau said factory orders increased by a seasonally adjusted 1.2% in August. Analysts had expected order to increase by 1.0%. Factory orders decreased 3.3% in July.  

The number of individuals filing for initial jobless benefits in the week ending September 29 declined by 12,000 to a seasonally adjusted 260,000 from the previous week's total of 272,000, the U.S. Department of Labor said. Analysts expected jobless claims to fall by 7,000 to 265,000 last week.  

Fed's Harker said 'expect U.S. economy to end abv 2% at the end of year; still penciling in Dec rate hike; still expect 3 rate hikes next year; pencils in one more rate hike this year, 3 for next.'  

Versus the Japanese yen, dollar met renewed selling at 112.92 at Asian open and dropped to 112.57 in European morning on broad-based buying of yen. The greenback then fell to session low at 112.42 at New York open before staging a rebound to 112.70 in New York morning on the back of upbeat U.S. economic data, the pair later hit session highs of 112.87 on broad-based usd strength and last traded at 112.81 at the close.  

Although the single currency rebounded to 1.1779 in early European morning, price quickly erased its gains after release of ECB minutes and tumbled to 1.1709 in New York morning as concerns over Spain's Catalonia region continued to linger together with dollar's strength post release of strong U.S. data. Price later hit session lows of 1.1700 ahead of New York close before staging a minor recovery on short covering.  

Although the British pound edged up to session high at 1.3250 ahead of European open, price pared its gains and tumbled to 1.3174 in early European morning on renewed concerns over U.K. PM May's leadership on media reports on some Tory members are calling for her resignation. Cable continued to ratchet lower and hit 1.3123 in New York morning on dollar's strength and active cross-selling of sterling especially vs euro. Price lower weakened to a near 1-month trough of 1.3109 in New York afternoon before stabilising 
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Germany's BDI Industry Association said 'looking with concern at progress in Brexit talks; British govt lacking clear concept on Brexit despite a lot of talk; German firms with presence in UK must make provisions for possibility of very hard Brexit.'  

In other news, BoJ's Nakaso said 'there is good prospect of inflation pressure building up; tight labour mkt n accomodative monetary conditions should mitigate frictional costs that might otherwise accompany necessary structural reform; more reasons to believe that true dawn is near after monetary policy false dawns; expects inflation will go up gradually as more firms reach tipping point of higher wage growth as productivity.'  

Data to be released on Friday: 

China market holiday, Japan coincident indicator, leading indicator, Germany industrial orders, France current account, U.K. Halifax house price, Italy retail sales, Canada employment change, unemployment rate, Ivey PMI, and U.S. non-farm payrolls, private payrolls, unemployment rate, average earnings, wholesale sales.