Dollar Gains on GDP Revision

The dollar advanced modestly thanks to a much better-than-expected upward revision to third quarter U.S. GDP which helped offset an above consensus decline in November durable goods orders and increase in initial jobless claims.

According to the third revision, the U.S. economy grew at an annualized rate of 3.5% versus the earlier growth rate of 3.2%, and above expectations for a small revision to 3.3%. Conversely, durable goods orders were down 4.6% last month, although orders excluding the transportation sector rose 0.5%, more than twice what was expected. Additionally, initial jobless claims rose 21,000 to 275,000, the highest number of new jobless claims in six months, and the Chicago Fed national activity index plummeted to -0.27 from -0.05 in October.

According, the dollar was pushed to 117.85 against the yen, and to 1.0425 versus the euro from 117.60 and 1.0452, respectively.

USD/CAD is racing higher on the combination of bullish U.S. GDP and larger-than-expected drop in Canadian CPI (core and nominal) that overshadowed a beat on Canadian retail sales. USD/CAD is now 0.70% higher at an 18-day high of 1.3520.

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