Dollar Weakens Ahead of Key Payrolls Data

Dollar Weakens Ahead of Key Payrolls Data
Dollar Weakens Ahead of Key Payrolls Data

By Peter Nurse

Investing.com – The dollar edged lower Monday, just above a one-month low, in tight trading ranges ahead of the release of key U.S. employment data later in the week which could influence Federal Reserve policy.

At 3:05 AM ET (0705 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% lower at 92.102, just above Friday’s low of 91.775, the weakest since June 28.

edged lower to 109.67, drifted higher to 1.3905, and traded largely flat at 1.1867, even with surprising to the upside, growing 4.2% in June. .

The dropped close to 1% last week after Fed Chairman Jerome Powell stated, following the central bank’s July meeting, that interest rate increases were still a long way away and more economic progress was needed, particularly in terms of jobs being created, before the central bank started tapering its huge bond-buying program.

Fed board member Lael Brainard restated the central bank’s focus on further labor market progress at the weekend, while Minnesota Fed President Neal Kashkari warned that the spread of the delta variant of Covid-19 could slow the economy in the second half.

This puts Friday’s July release firmly into focus, with economists looking for an increase of 900,000 jobs, which would be the biggest increase for 11 months, after a forecast-beating 850,000 in June.

“A strong US jobs report is anticipated, and it will support speculation that at the Jackson Hole conference at the end of August, Chair Powell will provide more guidance about the pace and composition of the Fed’s bond purchases,” said Marc Chandler, Chief Market Strategist at Bannockburn Global Forex.

Also of interest will be the meeting of the early Tuesday, with this central bank under pressure given the Covid-19 lockdowns currently affecting much of the country.

“The lockdown in Sydney has been extended until the end of August, and the Reserve Bank of Australia will likely abort plans to reduce its bond-buying. Instead, it will likely provide more support, probably via increased bond purchases,” Chandler added.

At 3 AM ET, traded marginally lower at 0.7342, with the Australian dollar having been the only major currency to fall against the U.S. dollar last week.

rose 0.1% to 6.4645 after China’s factory activity growth slowed sharply in July, with the falling to 50.3, its lowest level since April 2020.

 

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Leave a Reply

Your email address will not be published.

New Brokers
2.8 rating
Buy & sell Crypto in minutes
3.0 rating
Note: Investing involves risks. You can lose your deposit. We advise you to only invest in financial products which match your knowledge and experience.
2.0 rating
Interactive Brokers attracts active traders with low per-share pricing, an advanced trading platform.
4.3 rating
eToro is the world’s leading social trading platform, with thousands of options for traders and investors.
AdonFinance
Risk Warning: The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory or other services by AdonFinance. In addition, the content of the website offers no opinion with respect to the suitability of any security or any specific investment. Trading foreign exchange, stocks, cryptocurrencies and commodities is potentially high risk and may not be suitable for all investors. The high level of leverage can work both for and against traders. Before any investment with any broker you need to carefully consider your targets, previous experience, and risk level. Forex trading can result in the loss of your money, as a result, you are expressly cautioned that you should never invest or trade with money that you cannot afford to lose. For the avoidance of doubt, AdonFinance's service provides Brokers reviews in the Financial market. AdonFinance, its subsidiaries, agents or affiliates will assume no responsibility whatsoever for your trading activity. © Copyright 2021 AdonFinance