The dollar remained flat as the number of jobless Americans filing for unemployment benefits rise. The expected figures rose higher than the estimated last week. The dollar index stayed at 97.20.
Initial Jobless Claims
The measure of the number of individuals who filed for unemployment benefits is known as initial jobless claims. Though the claims rose by 3,000 to 241,000 from the week of June 11 to June 17, the recent figures made a little impact on the dollar and the markets showed no reaction.
Economists had initially expected the jobless claims data to increase up to 240,000.
U.S. Jobs Market
Back in May of this year, the dollar also fell as employers were only able to hire 138,000 after Trump won the presidency. Ever since Trump’s leadership, corporate sentiment revolves around the major issues like aggressive deregulation, deep corporate tax cuts and an infrastructure package, thinking that it can boost the economy.
However, the Trump’s administration is having a difficulty making clear plans as it got itself overinvolved with health care reform concerns.
The recent situation discourages some businesses to pursue expansion plans. Moreover, employers are having a hard time finding the appropriate employees with the needed skills set and such is affecting the present pace of hiring.
Recent data have revealed that job growth averaged to 121,000 only, compared to the usual average of 187,000 in previous months.
“Employers are having more difficulty finding the workers they need to fill vacancies. In addition, the labor force participation rate has stopped rising for the time being, another sign that fewer potential workers remain on the sideline,” said Brian Schaitkin, a senior economist at the Conference Board.
Dollar versus Other Currencies
Against the other currencies, the dollar remained unchanged. The markets did not react significantly. EUR/USD was steady at 1.1171. For the AUD/USD there was only a little change at 0.7550. Yet, the USD/CAD pair slid 0.13% trading at 1.3319 as falling oil prices is impacting the current situation.
Healthy Job Market
Though the weekly applications for the initial jobless claims rose by 3,000, officials are claiming that the figures remain at a level consistent with the tight labor market. It is because that the previous week’s tally is the 120th consecutive week where claims did not rise to 300,000. It is an indication that the figures are still at a threshold for a strong labor market consideration.
The period marks the longest stretch where U.S. job market persisted below such particular level since 1970. The lowest record was at 162,000 back in November 1968 and the highest was recorded in October 1982, an all-time high of 695,000.
For the initial jobless claims, when the reading is higher than expected, it can mean a negative impact for the U.S. dollar whereas a lower than expected one is regarded as something positive for the greenback. This measurement is a good indication of the U.S. job market status. The data so far do not have any effect on the dollar and as the Labor Department affirms, there are no distinctive factors contributing to the current data.
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