Forexpros – The U.S. dollar added to early gains against its major counterparts on Wednesday, as Italian 10-year bond yields remained close to the 7% threshold widely seen as unsustainable, despite purchasing by the European Central Bank.
During European afternoon trade, the dollar was up against the euro, with EUR/USD shedding 0.37% to hit 1.3492.
The euro remained under pressure after Italian lender Unicredit said it would ask the ECB to extend its access to funding, fuelling concerns over the health of the region’s banking sector.
Earlier in the day, official data showed that the rate of consumer inflation in the euro zone remained unchanged at 3% in October, in line with expectations.
The greenback was also stronger against the pound, with GBP/USD slipping 0.15% to hit 1.5798.
The Bank of England’s quarterly Inflation Report released earlier said economic growth will be “significantly weaker” than forecast in August and indicated that the bank may have to add to its GBP275 billion asset purchase program to shore-up growth.
The report came after official data showed that the unemployment rate in the U.K. jumped to a 15-year high of 8.3% in October, while the number of people without a job on the wider ILO measure rose to a record high.
Meanwhile, the number of people claiming jobless benefit rose by 5,300 last month, far below analysts’ forecasts of a rise of 20,400.
Elsewhere, the greenback was lower against the yen but climbed against the Swiss franc, with USD/JPY slipping 0.12% to hit 76.93, and USD/CHF rising 0.36% to hit 0.9183.
Earlier Wednesday, the Bank of Japan left interest rates unchanged and cut its economic outlook amid uncertainty over the global economic outlook and the deepening debt crisis in the euro zone.
The bank also said that it may implement new stimulus measures if the yen continues to appreciate after climbing to postwar highs against the greenback last month.
The greenback was also higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD adding 0.45% to hit 1.0256, AUD/USD shedding 0.56% to hit 1.0119 and NZD/USD falling 0.66% to hit 0.7660.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.31% to hit 78.34.
Later in the day, the U.S. was to release official data on consumer price inflation and industrial production.
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