FOREX – Dollar Rises as Investors Seek Shelter Amid Grim U.S. Numbers

By Gina Lee

Investing.com – The U.S. dollar was up in Asia on Thursday morning as investors flocked to the greenback amid grim data released by U.S. overnight.

The US Dollar Index that tracks the greenback against a basket of other currencies slipped 0.46% to 99.94 by 11:39 AM ET (4:39 AM GMT).

The data revealed the extent of the damage unleashed by the COVID-19-induced lockdown as retail sales for March dropped a record 8.7%. The country expects another 5.1 million Americans to file for unemployment as initial jobless claims data is released later in the day.

“Given the scale and breadth of the U.S. shutdown, our best guess is the economy contracts by around 13% peak-to-trough before we start to see a rolling process of re-opening in the United States from mid-May,” James Knightley, Chief international economist at ING, told CNBC.

“This will involve some ongoing form of social distancing meaning that a return to ‘business as usual’ could take many months — we don’t expect the lost output to be fully recovered until mid-2022.”

The USD/JPY pair gained 0.44% to 107.94.

The AUD/USD pair dropped 0.51% to 0.6286 despite Australia’s statistics bureau announced an unemployment rate of 5.2%, better than the predicted 5.5%.

But the bureau warned that the rate was calculated before lockdown measures came into effect.

Across the Tasman sea, the NZD/JPY pair lost 0.53% to 0.5957.

The USD/CNY pair gained 0.22% to 7.0817 whilst the GBP/USD pair slid 0.30% to 1.2477.

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