2020.08.1320:25:00UTC+00U.S. Dollar Shows Modest Move To The Downside

With a stalemate in Washington overshadowing upbeat jobless claims data, the U.S. dollar has moved modestly lower on Thursday. The U.S. dollar index has edged down by 0.2 percent.

The greenback is trading at 106.93 yen versus the 106.91 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1812 compared to yesterday's $1.1784.

The modest weakness by the dollar came as Democrats and White House officials remain at an impasse over a coronavirus relief bill.

House Speaker Nancy Pelosi, D-Calif., and Treasury Secretary Steven Mnuchin spoke on Wednesday, but both sides came out of the conversation blaming the other for a lack of progress.

President Donald Trump, who has taken unprecedented action to circumvent Congress due to the impasse, claimed "the bill's not going to happen" during a press briefing.

The ongoing stalemate over a new stimulus bill has raised concerns the economic recovery implied by recent data could stall.

Meanwhile, the Labor Department released a report showing first-time claims for U.S. unemployment benefits declined by much more than anticipated in the week ended August 8th.

The Labor Department said initial jobless claims tumbled to 963,000, a decrease of 228,000 from the previous week's revised level of 1.191 million.

Economists had expected jobless claims to slide to 1.120 million from the 1.186 million originally reported for the previous week.

With the much bigger than expected decrease, jobless claims dropped below 1 million for the first time since the week ended March 14th.

"The drop in claims reflects economic reopening, but it also suggests the expiration of federal supplemental unemployment benefits may have convinced some people to stop collecting and find work," said Chris Low, Chief Economist at FHN Financial.

He added, "Alternatively, people could be falling off rolls because they no longer qualify for assistance in the absence of the emergency expansion of eligibility."