NEW YORK (Forex News Now) – The euro erased earlier gains on Thursday, falling back below the 1.4 mark, after official data showed that the number of initial U.S. jobless claims dropped more than forecast last week.
In late European currency market trading, EUR/USD hit 1.3872, down 0.42 percent on the day, after retreating from 1.4029, a fresh 8-month high.
The U.S. Labor Department said earlier that there were a seasonally adjusted 445,000 initial jobless claims last week, after an upwardly revised 456,000 during the previous week. Analysts had expected a more modest drop in claims to 454,000 last week, two currency market trading news outlets reported.
According to EUR USD analysis, EUR/USD was likely to touch support around Tuesday’s low, 1.3637, and encounter resistance around the daily high, 1.4029.
Also Thursday, both the European Central Bank and the Bank of England held their benchmark interest rates steady, as widely expected. Jean-Claude Trichet, the ECB president, also signaled that the central bank would maintain its policy of gradually removing extraordinary economic stimulus measures — even as the U.S. Federal Reserve is believed to be moving in the opposite direction.
Elsewhere, the euro slid versus sterling: EUR/GBP traded at 0.8743, down 0.29 percent, according to intraday analysis.