U.S Dollar weakens after GDP release

Thursday, 26 May 2011 04:17

The number of individuals who filed for unemployment insurance for the first time during the past week added up to 424,000 people; 21,000 individuals more than expected.  Also, this week's subtotal was 10,000 people more than last week's total of unemployment claims filed.  Forecasted number of individuals expected to file for unemployment was approximately 403,000; while previous results came out at 414,000. 

Traders focus weekly on this news release as the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions; 

Another news release for the US was the GDP second release, which also disappointed at 1.8% while it was expected to show a 2.2% release.  Gross Domestic Product remained the same as the previous GDP release, both at 1.8%.

The Dollar's gains today were erased as the currency weakened against major currencies after the GDP and jobless claims release.  EUR/USD grew even stronger, trading at 1.4174 as it's aiming 1.42 line.  GBP/USD is also gaining pips as it's trading today's highs at 1.6348.

USD/JPY is trading at 81.22 and USD/CHF fell, meaning the Swiss Franc is gaining, to trade at 0.8661