The greenback is trying to hold onto recent gains as a result of safe-haven flows as concerns of a Coronavirus resurgence grow. Analysts point out that the most recent signs, evident in mounting data, suggests that the ongoing surge of infections is a significant threat to the US economy. A number of US states are seeing the resumption of high infection rates and deaths and, as a result, are once again forced to impose quarantine and lockdown measures. FX traders are also wary of high risk trades given the widening rift between China and the US. In the latest news, China has pledged to retaliate against any sanctions that the US plans to impose.
As of 10:01 am in Tokyo, the GBP/USD was trading at $1.2560, a gain of 0.0621%, off the session trough of $1.25466. The EUR/USD was essentially flat at $1.1381, with the pair ranging from a low of $1.13718 to a high of $1.13938. The USD/JPY was lower at 107.2440 Yen, down 0.01% and off the session peak of 107.403 Yen.
Mixed Outcome for US Labor Data
On Thursday, the US Labor Department reported some mixed results for unemployment benefits for the 4-week period ended July 10th. Initial jobless claims were higher than analysts had predicted at 1.3 million, above a forecast of 1.25 million while continuing claims for benefits were lower at 17.338 million, off the predicted 17.6 million. Retail sales figures were better than expected with reading for the Retail Sales Control Group coming in at 5.6% versus 3.6% expected, while month-over-month retail sales were at 7.5%, above the 5% expected.