U.S. initial jobless claims fell 23k to 259k in the week ended Sep 16, after tumbling 16k to 282k in the September 9 week (revised from 284k). The 4-week moving average moved up to 268.75k from 262.75k (revised from 263.25k). Continuing claims surged 44k to 1,980k in the September 9 week following the prior week’s 15k drop to 1,936k (revised from 1,944k). Though this week’s initial claims data takes on more importance since it coincides with the BLS survey week, hurricane disruptions will limit the usefulness of the numbers. The BLS did say, though, that the effects of Harvey were fading. Claims were estimated in South Carolina and the Virgin Islands. U.S. September Philly Fed manufacturing index rose 4.9 points to 23.8, better than forecast, following the 0.6 point dip to 18.9 in August. After surging 19.7 points to a 33-year high of 43.3 in February, the index had fallen in five of the last seven months. The components were mixed.
The dollar rose after the mix of data, where jobless claims unexpectedly fell, despite hurricane disruptions, and the Philly Fed index blew out expectations by rising sharply. EUR-USD fell just under 1.1900 from 1.1915, as USD-JPY topped 112.50 from near 112.35. Equity futures continue to indicate a marginally lower Wall Street open, while yields were little changed. However, USDJPY has remained buoyant in general, even after the good data, which did not seem to affect the market a lot. The pair seems that finds bids at 112.20 after correcting off a new four-month high at 112.71, which was seen early in the London session. The high was seen after BoJ Governor Kuroda speech in press conference. The USDJPY to remain underpinned for now. Intra-day support comes in at 111.99-112.00, while if the pair continues moving above the 200-Day MA then the July peaks could provide possible future targets. This risk to a bullish view would be re-appearance of a risk-off theme in global markets, as such phases tend to drive USDJPY lower. North Korea’s march to nuclear ICBM is the main threat to the apple-cart on this front.
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