Dollar Stays Firm Against Major Rivals

(RTTNews) - The U.S. dollar firmed against several major currencies on Thursday amid falling risk appetite due to rising possibility of a recession.

The Fed's plans to aggressively raise interest rates to combat inflation has led to concerns tighter monetary policy will tip the economy into a recession.

In his testimony before the Senate Banking Committee on Wednesday, Federal Reserve Chair Jerome Powell reiterated his commitment to moving expeditiously to bring inflation back down.

Powell has acknowledged that achieving a "soft landing" will be "very challenging" due in part to factors outside of the Fed's control and noted a recession is "certainly a possibility."

Data from the Labor Department showed first-time claims for U.S. unemployment benefits edged slightly lower in the week ended June 18th, dropping to 229,000, a decrease of 2,000 from the previous week's revised level of 231,000.

Economists had expected jobless claims to slip to 227,000 from the 229,000 originally reported for the previous week.

A report from Markit Economics said that according to preliminary estimates, the S&P Global US Composite PMI fell to a five-month low of 51.2 in June 2022 from 53.6 in May.

The S&P Global Flash US Manufacturing PMI fell to 52.4 in June 2022 from 57.0 in May, and below forecasts of 56.0. The S&P Global US Services PMI fell to 51.6 in June of 2022 from 53.4 in May, the lowest in five months and well below forecasts of 53.5.

The dollar index, which dropped to 104.06 earlier in the day from around 104.77, recovered to 104.40, gaining nearly 0.2% over the previous close.

Against the Euro, the dollar firmed to $1.0524 from $1.0569.

The dollar is trading at $1.2261 against Pound Sterling, little changed from the previous close.

Against the Japanese currency, the dollar is weak, fetching 134.98 yen a unit, nearly 1% less than Wednesday's close of 136.24 yen.

Against the Aussie, the dollar is stronger at 0.6895. The Swiss franc is down slightly at 0.9614 a dollar.

The dollar is trading stronger against the Loonie, fetching C$1.2994, up from C$1.2948.