Dollar firms broadly, bolstered by robust US retail sales

Sha Ying | CNBC

The dollar firmed across the board on Thursday, helped by an upbeat U.S. retail sales report that suggested the recovery of the world's largest economy is on a stable footing.

That report, however, does not alter expectations as to how soon the Federal Reserve will begin reducing its economic stimulus, analysts said. Market participants still expect the Fed to pare back its asset purchases no later than March 2014 and this has been reinforced after Thursday's weaker-than-expected U.S. jobless claims data.

U.S. retail sales rose 0.7 percent in November, while initial jobless claims rose 68,000 to 368,000 last week, the largest weekly increase November 2012.

In midday trading, the dollar index rose 0.3 percent to 80.164, rebounding after three days of losses.


The dipped 0.2 percent against the dollar to $1.3753 , threatening to end a seven-session streak of gains. It has gained nearly 4 percent since Nov. 11 and is close to its 2013 peak of $1.3832.

The dollar advanced 0.7 percent against the yen to 103.10 , rising after two straight days of losses. The euro also gained, up 0.5 percent at 141.78 yen, not far from a five-year peak of 142.17 yen.

The Australian dollar fell sharply to US$0.8914, its lowest since Aug. 30, hurt by comments from Reserve Bank of Australia Governor Glenn Stevens saying that he prefers the Aussie dollar to trade closer to US$0.85. The Aussie was last at US$0.8922, down 1.5 percent.