US Dollar Rises Against Major Peers on Strong GDP Data

The US dollar rose against the euro and the Japanese yen, among other major peers on Thursday, after a report that said that gross domestic product in the United States grew more than expected. Disappointing data releases in the Eurozone weighed on the euro today, which gave way for the US dollar to score more gains.

The US Bureau of Economic Analysis released a report on growth domestic product in the fourth quarter of 2016 at 12:30 GMT today, which said that it grew at an annualized rate of 2.1%. This is the third estimate from the bureau, which compares to a 1.9% growth in the second estimate. Gross domestic product increased 3.5% in the third quarter.

The higher estimate came as more data became available, which showed that consumer spending increased more than previously estimated. State and local government spending also improved, which offset lower exports and federal government spending in the fourth quarter.

In 2016, gross domestic product increased 1.6%, from 2.5% in the previous year. Higher imports and lower private inventory investment contributed to the smaller growth in 2016.

The euro was weaker today as the Federal Statistical office of Germany revealed that the consumer price index had a bigger drop than expected in March, which raised worries of slowing economic growth. The shared currency was already weaker following dovish comments from the European Central Bank.

EUR/USD traded at 1.0682 as of 19:25 GMT on Thursday, the pair’s lowest level since March 15, after starting the day at 1.0762. USD/JPY was at 111.73, the pair’s strongest rate since March 21, from 111.10 when the day began.

The Dollar Index, which tracks the performance of the US currency against a basket of its major peers, rose to 11.46 as of 19:21 GMT today, from 99.99 yesterday.

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