The Australian dollar fell against U.S. dollar on Thursday after Australia’s unemployment rate remained unchanged at 5.8%.
Australian Bureau of Statistics reported an unemployment rate of seasonally adjusted 5.8% for December, which is same as in November and as per the expectations. In a release made earlier today, the number of employed people fell by 22,600 during the month.
In Japan, according to the government data released this morning, country’s core machinery orders went up unexpectedly by 9.3% in November from the previous month as demand picked up ahead of an upcoming sales tax hike. Economists had expected only an increase of 1.2%.
Also earlier today, Bank of Japan Governor Haruhiko Kuroda said that the BOJ will maintain its aggressive easing policy until the annual inflation rate is brought to around 2%. Speaking during BOJ branch managers meeting in Tokyo, Kuroda said, "Japan''s economy is on steady track toward the 2% price target." According to him, the Japanese economy is expected to continue a moderate recovery, which will be affected by fluctuations in demand before and after the April sales tax hike.
AUD/USD traded down 1.21% at 0.8808 while USD/JPY traded up 0.19% at 104.78.
Meanwhile on Wednesday, the U.S. dollar firmed against the euro and most other major currencies after data revealed that manufacturing activity in the New York State expanded at the fastest pace since May 2012 this month.
The Federal Reserve Bank of New York said that its general business conditions index jumped to 12.51 in January from an upwardly revised 2.22 in December. Analysts were expecting the index to rise to only 3.75.
Elsewhere, U.S. wholesale prices beat expectations and firmed the dollar further.
The U.S. producer price index rose 0.4% in December, the biggest increase since June, recovering from a 0.1% decline in November and was 1.2% higher from a year earlier.
Core PPI was up 0.3% in December and rose 1.4% on a year-over year basis, compared to expectations for a monthly increase of 0.1% and an annual gain of 1.3%.
The solid data convinced investors that the Federal Reserve will continue winding down its USD75 billion in monthly bond purchases in the coming months.
Bond purchases weaken the dollar by driving down long-term interest rates, and talk of their dismantling tends to strengthen the greenback.
Wednesday''s economic indicators were the latest convincing investors that the poor December jobs report was likely a hiccup on the road to recovery.
Also giving the dollar support, the Federal Reserve released its Beige Book earlier, which said the U.S. economy continues to expand at a moderate pace.
Meanwhile in Europe, data revealed the euro zone’s trade surplus widened to EUR16.0 billion in November from a surplus of EUR14.3 billion in October, largely due to a decline in imports. Analysts had expected the trade surplus to widen to EUR16.7 billion.
Elsewhere, Germany’s Federal Statistics Office reported earlier the economy expanded by just 0.4% in 2013 after increasing by 0.7% in 2012, as the crisis in the euro zone acted as a drag on growth. Analysts had been expecting growth of 0.5%.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, remanied unchanged at 81.12.
Later today, the U.S. is to publish reports on consumer price inflation and initial jobless claims, in addition to data on manufacturing activity in Philadelphia. Meanwhile, Federal Reserve Chairman Ben Bernanke is to speak at an event in W