EUR/USD close to session lows after US initial jobless claims

US dollar advanced sharply against the euro on Thursday, following the US weekly report, which said initial jobless claims decreased in number more than expected during the past week.

EUR/USD plunged to a session low at 1.3070 at 13:05 GMT, after which consolidation followed at 1.3080.

Earlier on Thursday the Department of Labor reported that the number of people, who filed for unemployment assistance in the United States decreased significantly during the week ended on July 13th 2013, implying that employers continued hiring new employees. During last week the number of claims diminished by 24 000 to 334 000, while results during the preceding week were revised down to 358 000 from 360 000 previously. Initial estimates pointed a smaller drop – to 345 000. This indicator showed fluctuations over the past few weeks due to seasonal factors, such as closures of factories during the summer period. Another indicator, which lacks such seasonal effects, more precisely, the average number of claims over the past four weeks, dropped by 5 250 to 346 000.

Meanwhile, investors were looking ahead to the second day of congressional testimony on monetary policy by Federal Reserve Chairman Ben Bernanke later in the trading day. On Wednesday Bernanke said that the scale of monetary stimulus was not on a “preset course” and depended on that how economy performed. Thus, if economic growth strengthened, the easing program could be tapered at a faster pace, while in case of the opposite situation, deteriorating economic results, the scale of asset purchases could be even increased.

US dollar hit session highs against the yen, with USD/JPY pair soared 0.70% to 100.25. Additionally, the greenback edged higher against the British pound, as GBP/USD cross dipped by 0.07% to 1.5201. Ultimately, US dollar extended gained positions against the Swiss franc, with USD/CHF pair rising by 0.48% to reach 0.9454.