Dollar Rises Against Major Counterparts After Jobless Claims Data

(RTTNews) - The U.S. dollar rose to over 2-year high on Thursday amid bets the pace of interest rate cuts by the Federal Reserve will be slow this year, after data showed a bigger than expected drop in weekly jobless claims.

Data from the Labor Department report showed an unexpected decline by weekly jobless claims seemingly provides support for the Federal Reserve's measured approach to lowering interest rates.

The report said initial jobless claims slipped to 211,000 in the week ended December 28th, a decrease of 9,000 from the previous week's revised level of 220,000.

Economists had expected claims to inch up to 222,000 from the 219,000 originally reported for the previous week.

With an uptick by spending on private construction offset by a dip in spending on public construction, the Commerce Department released a report on Thursday showing U.S. construction spending was virtually unchanged in the month of November. The Commerce Department construction spending crept up by less than a tenth of a percent to an annual rate of $2.153 trillion in November.

The dollar index surged to 109.53 around late morning and despite paring some gains as the day progressed, was still firm at 109.26, gaining 0.78% or about 0.72%.

Against the Euro, the dollar firmed to 1.0270 from 1.0360, and strengthened to 1.2380 against Pound Sterling from 1.2517.

The dollar gained marginally against the Japanese currency, advancing to 157.54 yen. Against the Aussie, the dollar weakened to 0.6203 from 0.6192.

The Swiss franc weakened to 0.9125 against the dollar, while the Loonie eased to 1.4404, losing slightly from previous close.