Euro advances further aginast a broadly weakened dollar

A choppy day in this currency pairing eventually saw the euro advance 0.15%, its fifth straight day of gains against the greenback.

• The single currency was initially able to make strong gains against the greenback yesterday, hitting a new high for 2009 of 1.4611, after a report showed a drop in the number of US jobless claims last week.
  
• The improvement to 550K claims, supported investors’ recent demand for riskier investment in stocks, commodities, and currencies.
  
• However, data also showed that the US trade deficit for July widened by 16.3% to $32.0 billion, the biggest month-on-month increase since 1999, which dented risk sentiment and sent the single currency back below 1.4600.
  
• Early rises in European stocks also faded in the afternoon which put further selling pressure on risky assets, with the euro finally closing down at 1.4579.
  
• Better-than-expected Chinese data last night has put further selling pressure on the dollar, with the single currency continuing to advance this morning.
  
• There is a consumer sentiment survey in the US today at 14:55BST which will give investors a good indicator of the current level of confidence in the US economy.