The dollar rose against the major currencies this afternoon after weekly jobless figures raised hopes for US economic recovery. Initial claims for state unemployment benefits fell 29,000 to a five-month low of 386,000 last week, the Labour Department said. At 1630, the euro was trading at USD1.1442, down 0.40pc since this morning having earlier risen to a three week high and threatened the USD1.15 level. Sterling was valued at USD1.6091, off its earlier high above USD1.6120.
Although seasonal factors played a major role in the improved figures, shares on Wall St also rallied in the wake of the figures, with the Dow Jones up 0.8pc and the Nasdaq gaining 0.9pc. The Labour Department cautioned against reading too much into the figures, saying that summer figures are often volatile as factories scale down production for retooling causing temporary lay offs before rehiring again. //www.fxcentre.com