U.S. Dollar Spikes Up Amid Falling Jobless Claims, Debt Ceiling Deal Hopes

(RTTNews) - The U.S. dollar appreciated against its major counterparts in the New York session on Thursday, as jobless claims came in lower than expected last week and on optimism over progress in the debt ceiling talks in Washington.

Data from the Labor Department showed that first-time claims for U.S. unemployment benefits fell more than expected in the week ended May 13.

The report said initial jobless claims slid to 242,000, a decrease of 22,000 from the previous week's unrevised level of 264,000. Economists had expected jobless claims to dip to 254,000.

A separate report released by the Federal Reserve Bank of Philadelphia showed a continued contraction in regional manufacturing in the month of May, although the pace of contraction slowed by more than expected.

The Philly Fed said its diffusion index for current activity surged to a negative 10.4 in May from a negative 31.3 in April.

President Joe Biden and House Speaker Kevin McCarthy expressed optimism about reaching a deal for raising the debt limit.

The greenback touched 138.62 against the yen, its highest level since November 30. The pair had closed Wednesday's deals at 137.66. The greenback is seen finding resistance around the 140.00 mark.

The greenback climbed to more than a 3-week high of 1.2397 against the pound and more than a 5-week high of 0.9062 against the franc, from yesterday's close of 1.2486 and 0.8980, respectively. Next key resistance for the greenback is likely seen around 1.21 against the pound and 0.92 against the franc.

The greenback firmed to near a 2-month high of 1.0771 against the euro from the previous close of 1.0838. Should the greenback strengthens further, it is likely to test resistance around the 1.05 region.

The greenback appreciated to near a 3-week high of 0.6604 against the aussie and a 3-day high of 0.6206 against the kiwi, from Wednesday's close of 0.6659 and 0.6248, respectively. The greenback is likely to face resistance around 0.63 against the aussie and 0.60 against the kiwi.

The greenback moved up to 1.3497 against the loonie from yesterday's closing value of 1.3454. Next near term resistance for the greenback is likely seen around the 1.38 level.