American focus: the dollar strengthened against most major currencies

Dollar rose significantly against the euro, reaching thus the level of $ 1.0900, helped by US data on GDP. The Commerce Department said that US economic growth accelerated in the second quarter, as the rise in consumer spending offset the decline due to weak business spending on equipment, assuming a steady pulse that can bring the Federal Reserve to raise interest rates this year. Gross domestic product expanded at an annual rate of 2.3 percent, said Thursday. In the first quarter GDP, as previously reported, it was reduced to 0.2 percent. However, this figure was revised to a rise of 0.6 percent. The revision of growth in the first quarter reflected the steps taken by the Government to clarify the seasonal adjustment for some components of GDP, which economists say they have residual seasonality in the data, as well as the new source data. A measure of private domestic demand, which excludes trading stocks and government spending increased 2.5 percent after rising 2.0 percent earlier in the year. Business spending fell by 1.6 percent after falling 7.4 percent earlier in the year. Equipment costs fell by 4.1 per cent. Expenditure on exploration and production decreased by 68.2 percent, showing the largest decline since the second quarter of 1986. This category decreased by 44.5 percent in the first quarter. But there are signs that the decline in energy prices possibly coming to an end. Data on Friday showed that the energy company said 21 oil rigs last week, noting the third increase in the last 33 weeks. Exports grew in the second quarter, despite the strong dollar, while imports grew moderately. It has defined a smaller trade deficit, which added 0.13 percentage points to GDP growth. The price index for personal consumption expenditures rose 2.2 percent, the fastest growth since the first quarter of 2012, after falling 1.9 percent earlier in the year. Excluding food and energy, prices rose 1.8 percent.

The yen continued to fall against the US dollar, approaching to the lowest since June 10 after the last Federal Reserve indicated that interest rates may be increased in the coming months, with a certain probability in September. In his statement at the rate the Fed noted that the economy and the labor market continue to be strengthened, reinforcing hopes for an initial rise in rates at the meeting in September. The Fed reported that it is watching the economic recovery after the recession in the first quarter and its "moderate growth" in the moment. The Fed chief Janet Yellen said that the Central Bank may raise rates in September if the economy continues to improve the alleged rate.

Meanwhile, support for the dollar have data on GDP and the US labor market. As it became known, the number of Americans who first applied for unemployment benefits last week rose to forty minimum, but the general trend shows that the labor market is strengthening. Primary applications for unemployment benefits, an indicator of layoffs, increased by 12,000 to 267,000 seasonally adjusted in the week ended July 25th. Economists expected 270,000 initial claims for unemployment benefits last week. Previous week remained at 255000. The level of initial claims for the week ended July 18 was the lowest since November 1973.

The pound fell sharply against the dollar, at least updating session. The pressure on the currency has stats on the US, which has strengthened expectations of a rate hike this year. The US Commerce Department reported that gross domestic product grew 2.3% in the three months ended June 30. The US economy in the first quarter showed an increase of 0.6%, confounding forecasts for a 0.2% reduction. While economists had forecast GDP growth of 2.6%, the report indicates that the economy is showing strong recovery. The data came after the Federal Reserve said yesterday that the economy and the labor market continue to be strengthened, reinforcing hopes for an initial rise in rates at the meeting in September. The Fed reported that it is watching the economic recovery after the recession in the first quarter and its "moderate growth" in the moment.