European session review: USD strengthens ahead of U.S. weekly jobless claims and August retail sales data

USD appreciated against most of its major rivals in the European session on Thursday, as investors awaited the release of the U.S. weekly jobless claims and retail sales data for August later today (12:30 GMT), which could provide more clarity on the health of the country’s economy and hint at the Federal Reserve's future path regarding the withdrawal of its stimulus measures.

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, increased  0.19% to 92.73.

According to economists’ forecast, the U.S. jobless claims totaled 330,000 last week, up from 310,000 in the week prior, and the retail sales declined 0.8% m/m in August, following a 1.1% m/m fall in the previous month. 

It is expected that these statistics could influence the Fed officials’ decision on the tapering of the bond purchases, when they gather for a two-day policy meeting on September 21. The August data on employment, which showed a sharp slowdown in the U.S. jobs growth, and consumer inflation, which showed a moderate slowdown in the price increase, eased somewhat concerns of a sudden tapering in the  Fed’s monetary stimulus but provided no certainty on the timing of the process. 

Earlier this month, several Fed officials stated that the U.S. central bank should start reducing bond purchases by the end of the year, despite disappointing August jobs data.