USD flows: USD resilient despite higher claims
Higher claism may be a sign of things to come, but USD still resilient for now
US claims data shows the first signs of post-tariff weakness in the labour market, with continuing claims the highest since the pandemic, and a significant rise in initial claims as well. We have on occasion seen such rises before, and one week doesn’t make a trend, but the data looks potentially significant. Of course, this is after the survey date for this week’s payroll data, so we are unlikely to see significant weakness in the employment report. The USD initially dipped a little on the data, but has recovered quickly. Nevertheless, we would see the current USD recovery, which has been based on better equity market performance after the latest Tech results, as coming close to its end.