The greenback went through a volatile session as despite rising in Asia and European morning on safe-haven buying due to spike in global coronavirus infections, dollar met renewed selling and later fell against majority of its peers in New York due to return of risk sentiment as U.S. Democrats and Republicans will resume Covid-19 relief negotiations.
Reuters reported U.S. Senate Democratic leader Chuck Schumer said on Thursday that Republican Majority Leader Mitch McConnell had agreed to resume COVID-19 relief talks as cases surge across the country, CNBC reported.
Versus the Japanese yen, dollar rebounded to 103.98 before dropping to session lows at 103.72 in Asian morning. However, the pair then erased intra-day losses and rallied to 104.21 in European morning on safe-haven usd buying before retreating to 103.74 near New York close on renewed usd's weakness together with drop in U.S. Treasury yields.
The single currency retreated to 1.1833 in Asia before rebounding to 1.1851 at European open but only to drop to session lows at 1.1817 in European morning on usd's strength. However, the pair then erased intra-day losses and rallied to 1.1882 near New York close on return of risk sentiment following news that the U.S. Democrats and Republicans will resume Covid-19 relief talks.
The British pound remained under pressure and weakened to 1.3225 in Asia and edged lower to 1.3206 in European morning on negative Brexit news. Cable then rebounded strongly to 1.3264 in Europe before falling to an intra-day low at 1.3197 in New York morning. However, the pair then rallied to 1.3279 in New York afternoon as risk appetite returned after news that U.S. will resume stimulus talks before retreating.
Reuters reported European Union leaders are set to demand the European Commission publish no-deal plans, the Times reported on Thursday. "We must now come up with contingency measures. January 1, 2021 is getting close; we need a safety net," a senior EU diplomat told the Times.
In other news, Reuters reported while the U.S. economy came back stronger than expected in the third quarter, the rise in infections is concerning and small businesses and households need more support from fiscal aid, Cleveland Federal Reserve Bank President Loretta Mester said Thursday. "The fact that we don't have a fiscal package is very concerning," Mester said during an interview with Bloomberg TV. "With the disparate impact of this pandemic that's where fiscal policy plays a role because fiscal policy can be really targeted to the households and small businesses that really need the aid."
On the data front, Reuters reported the number of Americans filing new claims for jobless benefits unexpectedly rose last week as new business closures to control the spiraling COVID-19 infections unleashed a fresh wave of layoffs and further slowed the labor market recovery. Initial claims for state unemployment benefits totaled a seasonally adjusted 742,000 for the week ended Nov. 14, compared to 711,000 in the prior week, the Labor Department said on Thursday. Economists polled by Reuters had forecast 707,000 applications in the latest week.
Data to be released on Friday:
Japan nationwide core CPI, nationwide CPI, Jibun Bank manufacturing PMI, UK GfK consumer confidence, PSNB, PSNCR, retail sales, retail sales ex-fuel, Australia retail sales, Germany producer price index, Italy industrial orders, industrial sales, Canada new housing price index, retail sales, retail sales ex-autos and EU consumer confidence.
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