Dollar drifts higher as coronavirus, China data sap confidence

Friday,   14-Aug-2020   08:56 AM (IST)

The dollar drifted higher on Friday, helped by strong U.S. jobs data as well as firmer global demand for safe-havens amid concerns about the coronavirus recovery, setting the currency up to potentially snap a seven-week losing streak. Soft Chinese retail and production figures cast a pall over the mood in Asia, dragging on the risk-sensitive Australian and New Zealand dollars. The Aussie was last 0.2% softer at $0.7138 and has settled in to a range around that level after pulling back from a 18-month high hit a week ago. The kiwi was under pressure at $0.6537 as the country also faces a fresh COVID-19 outbreak and after dovish comments from the central bank this week. Other majors were mostly flat, but the euro hovered above $1.18. China's industrial output rose more slowly than expected in July and retail sales fell for a seventh straight month, suggesting some bumps in even the world's most promising rebound. Troubling signs also emerged on the health front in Asia, with a dozen new cases in New Zealand - which is considering whether to ease or extend its lockdown of Auckland - and the biggest daily jump in new cases in South Korea since March. Overnight the weekly number of applications for unemployment benefits in the United States dropped below one million for the first time since the start of the pandemic, with 963,000 claims coming in below expectations for 1.1 million. But beyond buoying the dollar any relief was shortlived, as some 30 million Americans are out of work and an aid package to keep stimulus flowing in the economy has stalled in Congress. Against a basket of currencies the dollar remains 0.1% lower for the week, but it has appeared to arrest a slide that has it about 9.5% below its March peak.