Summary:

• Weekly US initial jobless claims come in at 234k (vs 237k exp and 232k prior)
• Continues to signal strength in the labour market
• USD lacking direction in Jackson Hole

Today’s economic calendar is light in terms of market moving releases with the weekly initial jobless claims from the US the standout. The number of citizens claiming unemployment benefits ticked higher to 234k in the past week, marginally higher than the 232k seen last time out but below the consensus forecast of 237k.

This labour market indicator remains undeniably strong near to multi-decade lows but on its own it isn’t enough to support the US dollar. The buck has been coming back under pressure in the past week after bouncing from its 2017 low.

 The USD has fallen against most of its peers in the last week. Source: xStation

Looking at the US dollar index the market is holding onto key support at 92.45 but has failed to sustain a recovery. The wicks seen above the last two closed weekly candles indicates that rallies are getting sold back and whilst we have seen higher highs and higher lows in them, longs would want to see a move above last week’s peak at 94.04 before they can hope for a sustained move higher. 

 The USD index (USDIDX) has held key support around 92.45 but bounces have failed to hold of late. Source: xStation

With the highly anticipated Jackson Hole Symposium kicking off today the fate of the US dollar could soon be decided. Tomorrow’s speech from Fed chair Yellen will be keenly viewed and any substantial hawkish or dovish surprises could well lead to the next major move in the greenback. (Read our full preview here)