Dollar blips higher then back lower
The euro fell below 1.12 against the dollar for the first time since June 2020 on the back of a slate of US data that showed fewer jobless claims and an improvement in the trade balance. However the move only lasted for moments before it reversed.
EUR/USD is now trading at 1.1210.
It was a similar story elsewhere as the US dollar blipped higher and then gave most of it back.
Surveying the data, the first move was the right one. Initial jobless claims are at remarkably low levels in a sign that the jobs market is tightening faster than the Fed anticipated. That's likely to mean a faster taper or a swifter pace of hikes. Jobs are plentiful.
From here though, the PCE report is due in an hour. The market is closely watching inflation and we could see a larger or more-sustained dollar move on those numbers.