Dollar Erases Losses As U.S. Jobless Rate Falls
04 Maggio 2018 - 12:05PM
RTTF2
The U.S. dollar bounced off from its recent losses against its
major opponents in the European session on Friday, as the U.S.
unemployment rate fell to an 18-year low in April, indicating that
the Fed would continue with gradual rate hikes during the year.
Data from the Labor Department showed that U.S. unemployment
rate fell to 3.9 percent in April after holding at 4.1 percent for
six straight months. The unemployment rate had been expected to
edge down to 4.0 percent.
With the bigger than expected decrease, the unemployment rate
dropped to its lowest level since a matching rate in December of
2000.
Meanwhile, the non-farm payroll employment climbed by 164,000
jobs in April after rising by an upwardly revised 135,000 jobs in
March.
Economists had expected employment to increase by 192,000 jobs
compared to the addition of 103,000 jobs originally reported for
the previous month.
The mixed jobs data is unlikely to dissuade the Fed from holding
off its rate hike in June.
The Sino-U.S. trade talks ended in Beijing, with both two sides
exchanging views on expanding US exports to China, trade in
services, bilateral investment, protection of intellectual property
rights, resolution of tariffs and non-tariff measures.
Both sides recognized that large differences still remain on
some issues and they would continue to resolve relevant economic
and trade issues through dialogue and consultation.
The greenback rose against its major counterparts in the Asian
session, with the exception of the yen.
Following a 10-day decline to 108.65 against the yen in the
immediate aftermath of the data, the greenback bounced off to
109.19 in a short while. The pair ended Thursday's deals at 109.18.
Continuation of the greenback's uptrend may see it challenging
resistance around the 110.00 level.
The greenback quickly erased its data-induced losses against the
franc and spiked up to near a 6-month peak of 1.0009. If the
greenback continues its rise, 1.01 is possibly seen as its next
resistance level.
The greenback climbed to near a 4-month high of 1.1927 against
the euro, from a low of 1.1996 hit at 11:30 pm ET. Next key
resistance for the greenback is likely seen around the 1.17
level.
Final data from IHS Markit showed that Eurozone economic
activity expanded strongly in April but the pace of expansion
slowed marginally since March.
The composite output index fell slightly to 55.1 in April from
55.2 in March. According to flash estimate, the index remained
unchanged at 55.2 in April.
The greenback strengthened to 1.3524 against the pound, its
highest since January 11. This follows a low of 1.3586 seen at
10:30 pm ET. The greenback is likely to find resistance around the
1.34 area.
The greenback advanced to more than a 4-week high of 1.2917
against the loonie, after having fallen to 1.2836 at 9:45 pm ET.
The next possible resistance for the greenback is seen around the
1.31 area.
The greenback strengthened to 0.7492 against the aussie and
0.6994 against the kiwi, from its early 4-day lows of 0.7560 and
0.7053, respectively. The greenback is poised to challenge
resistance around 0.73 against the aussie and 0.68 against the
kiwi.
Looking ahead, Canada Ivey PMI for April is scheduled for
release shortly.
At 12:00 pm ET, New York Fed President William Dudley will
discuss financial turmoil and the challenges ahead in an interview
conducted by Matthew Winkler with Bloomberg News.
San Francisco Fed President John Williams will give remarks at
the Hoover Institute's Monetary Policy Conference, hosted by
Stanford University at 3:00 pm ET.
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