Stock Market Watch

Forex Market Update: Dollar Index Climbs Sharply After Job Data

by ·


The dollar index rose sharply on Thursday after two U.S. job data releases reemphasized the fact that the labor market was significantly improving, fanning speculation that the Federal Reserve could now soon end its economic stimulating measures.

The DXY Dollar Index, a gauge on U.S. unit’s performance against a basket of six rival currencies, rose 0.40% 82.49.

The WSJ$ Index, which uses slightly boarder indexing criteria, edged up 0.25% to 74.53.

Meanwhile the euro fell sharply against the dollar after the European Central Bank, as expected, kept its monetary policy unchanged.

The euro was last down 0.38% against the dollar to trade at $1.3156.

The Labor Department said that weekly first-time jobless claims fell further by 9,000 to seasonally adjusted 323,000 while the four-week moving average for first time claims stood at pre-recession level.

Separately, the Automatic Data Processing (ADP) said that the U.S. private sector added 176,000 new jobs in August, which was slightly below economists’ expectation.

Earlier on Wednesday, the Federal Reserve’s Beige Book, a comprehensive region-by-region coverage on state of the economic health, showed that the U.S. economy picked up some momentum in the second quarter.

Now the entire spotlight will shift to Friday’s non-farm payrolls report. If the report shows strong numbers the dollar is likely to climb even higher.

“If the number is around 200,000 the dollar will go higher. Our dollar forecasts for the next few months are quite upbeat as the Fed is going to taper this year,” said Neil Jones, head of hedge fund FX sales at Mizuho Corporate Bank, according to Reuters.

 

 

 








More Posts by this author

edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

You may also like...