USD gained on Thursday slightly to 93.76 against a basket of currencies but quickly fell to 93.713 at press time. The temporary strength was due to the promising job and housing data. Data showed that the number of Americans filing new claims for unemployment benefits dropped to a 19-month low last week, pointing to a tightening labor market. U.S. home sales also surged to an eight-month high in September.
China’s yuan has been climbing rapidly to its strongest levels in six years against the USD. So far, Beijing has not intervened directly or verbally over this trend. One popular theory is that the currency has been left alone while authorities focus on resetting the rules and financing options for sectors such as real estate and technology. Some analysts also think that PBOC is waiting for the Federal Reserve to begin its policy tightening, which could reduce the flow of foreign money that is pushing the yuan up.