March 26, 2020 / 1:52 PM / 14 days ago

FOREX-Dollar drops as U.S. jobless claims surge

    * Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh

 (Adds quotes, updates prices, new byline, changes dateline,
previous LONDON)
    By Karen Brettell
    NEW YORK, March 26 (Reuters) - The dollar dropped to a
one-week low against a basket of currencies on Thursday after
data showed an unprecedented surge in Americans filing for
unemployment benefits, as businesses across the country shut
down in an attempt to stem the spread of the coronavirus.
    The number of Americans filing claims for unemployment
benefits shot to record of more than 3 million last week.

    The jobless blowout was announced shortly after Federal
Reserve Chairman Jerome Powell said that the U.S. economy "may
well be in recession" but progress in controlling the spread of
the coronavirus will dictate when the economy can fully reopen.
His remarks were an unusual acknowledgement by a Fed chair that
the economy may be contracting even before data confirms it.

    “The number has sent chills through the markets. If these
numbers continue for three or four weeks, there will be demand
for more fiscal support," and even more monetary support from
the Fed, said Quincy Krosby, chief market strategist at
Prudential Financial in Newark, New Jersey.
    The dollar index fell to 99.92, the lowest since
March 18.
    The euro gained to $1.0972, up 0.85% on the day and
the highest since March 18.
    The greenback dipped 1.53% against the Japanese yen to
109.49 yen. 
    The Australian dollar jumped 1.31% to $0.6036.
    The U.S. Senate on Wednesday unanimously backed a $2
trillion bill aimed at helping unemployed workers and industries
hurt by the coronavirus epidemic, as well as providing billions
of dollars to buy urgently needed medical equipment.

    The Federal Reserve last week launched new bond purchase and
lending programs in an attempt to ease market logjams. It also
committed to swapping dollars for foreign currencies with other
major central banks after a desperate scramble for the currency
last week sent the dollar to three year highs against the euro,
35-year highs against sterling and 17-year highs against the
Australian dollar.
    “Although the latest Fed measures have helped calm markets,
as long as the Covid-19 crisis continues and the world economy
is effectively in lockdown, we would expect markets to remain in
turmoil,” foreign exchange analysts at Bank of America said in a
report on Thursday.
    
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    Currency bid prices at 9:23AM (1323 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.0972        $1.0880     +0.85%         -2.12%      +1.0990     +1.0872
 Dollar/Yen       JPY=        109.4900       111.1900    -1.53%         +0.58%      +111.3000   +109.3900
 Euro/Yen         EURJPY=     120.15         121.00      -0.70%         -1.48%      +121.0800   +119.9700
 Dollar/Swiss     CHF=        0.9684         0.9767      -0.85%         +0.06%      +0.9777     +0.9678
 Sterling/Dollar  GBP=        1.2012         1.1885      +1.07%         -9.40%      +1.2031     +1.1778
 Dollar/Canadian  CAD=        1.4073         1.4190      -0.82%         +8.37%      +1.4275     +1.4069
 Australian/Doll  AUD=        0.6036         0.5958      +1.31%         -14.03%     +0.6056     +0.5871
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.0630         1.0628      +0.02%         -2.05%      +1.0653     +1.0619
 Euro/Sterling    EURGBP=     0.9132         0.9150      -0.20%         +8.02%      +0.9239     +0.9130
 NZ               NZD=        0.5913         0.5848      +1.11%         -12.22%     +0.5932     +0.5779
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        10.4901        10.7480     -2.40%         +19.50%     +10.8276    +10.4780
 Euro/Norway      EURNOK=     11.5130        11.6970     -1.57%         +17.01%     +11.8276    +11.5036
 Dollar/Sweden    SEK=        10.0325        10.0749     +0.19%         +7.33%      +10.1565    +10.0158
 Euro/Sweden      EURSEK=     11.0060        10.9847     +0.19%         +5.13%      +11.0704    +10.9796
 

 (Additional reporting by Olga Cotaga in London and Medha Singh
in Bengaluru
Editing by Nick Zieminski)
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