By CountingPips.com
The U.S. dollar has been on the defensive in forex trading against the other major currencies today as comments out of China in support of the euro have helped boost risk appetite and stock markets higher. In response to an article from the Financial Times that China may re-evaluate its eurozone investments, Chinese government officials responded that this was not the case and remained committed to its euro holdings. The comments helped put investors in a positive 
buying mood today as global stock markets have increased across the board.
The forex markets have seen the dollar fall today versus the euro, Swiss franc, British pound, Canadian dollar, Australian dollar and the New Zealand dollar while gaining against the Japanese Yen, according to currency data by Oanda in the afternoon of the U.S. trading session. The euro has increased to its highest level since early in the week while the pound has touched its highest exchange rate since May 14th versus the dollar. The Australian, New Zealand and Canadian dollars have also traded at their highest levels since last week against the American currency.
The U.S. stock markets have advanced higher today with the Dow Jones rising by approximately 200 points, the Nasdaq increasing over 60 points and the S&P 500 up by over 20 points at time of writing. Oil has gained by $2.71 to $74.22 per barrel while gold has edged lower by $2.00 to trade at the $1,211.40 per ounce level.
US GDP revised lower for the first quarter of 2010
The U.S. economy expansion in the first quarter of 2010 was revised lower today, according to the data release by the U.S. Commerce Department. The second government estimate showed that the U.S. Gross Domestic Product grew on an annualized basis by 3.0 percent in the January to March quarter following a real 5.6 percent growth rate in the fourth quarter of 2009. Today’s estimate is a revision lower than the 3.2 percent estimate released last month.
The first quarter marked the third straight quarter of U.S. economic growth after the GDP had fallen for four straight quarters over the second half of 2008 and the first half of 2009.
Market forecasts were expecting GDP growth to be revised higher by 3.4 percent for the quarter.
Consumer spending was the key driver of growth in the quarter and rose by 3.5 percent following an increase of 1.6 percent in the fourth quarter. Consumer spending makes up roughly two-thirds of U.S. economic activity and the first quarter increase was the largest advance since the first quarter of 2007.
Exports of goods and services was revised higher and grew by 7.2 percent in the first quarter following a gain of 22.8 percent in the fourth quarter of 2009. Imports were also revised upwards and rose by 10.4 percent after a fourth quarter rise of 15.8 percent.
The third release for the U.S. GDP is scheduled for June 25, 2010 at 8:30 A.M. EDT.
Weekly Jobless Claims fall but 4-week moving average ticks higher
U.S. weekly jobless claims decreased in the week that ended on May 22nd, according to a release by the U.S. Labor Department today. New jobless claims fell by 14,000 workers to a total of 460,000 unemployed workers for the week but the 4-week moving average of unemployed workers increased by 2,250 workers from the previous week to a total of 456,500.
Market forecasts were expecting jobless claims to edge down to 455,000 workers following the prior week’s revised 474,000 claims.
Meanwhile, workers seeking continuing claims for unemployment benefits for the week ending May 15th also decreased for the week. Continuing claims fell by 49,000 workers to a total of 4,607,000 unemployed workers. The four week moving average of continuing claims dropped by 11,500 workers to a total of 4,637,250.
