Forex Market Update; Dollar Rises Sharply After Jobs Data
The U.S. dollar edged higher against major rivals as traders digested stronger than expected nonfarm payrolls data for the month of June.
The figures released by the Labor Department showed that the U.S. economy added 195,000 jobs in June, beating consensus forecast of 165,000 job additions. The unemployment rate, meanwhile, remained steady at 7.6%. The better than expected jobs data has raised the possibility of the Federal Reserve easing its bond buying program before the end of this year. This is positive for the dollar.
Speaking to Reuters, Alister Gaines, Director of CDC Wealth Management, said that the jobs number should by rights send Wall Street’s bulls rampaging but the market’s addiction to QE may yet hold them back. Gaines further said that that odds of the Fed starting to taper QE in September as planned have shortened and the markets know it.
The dollar is also strengthening after the European Central Bank (ECB) and Bank of England (BOE) on Thursday said that they plan to keep interest rates at low levels for a considerable period.
Alan Ruskin, Head of G10 FX Strategy at Deutsche Bank, told Reuters that the jobs data in the U.S. is strong enough that it validates the ECB’s and BOE’s attempts to try to distinguish their policy actions from those in the U.S.
At last check, the euro was down 0.6% to 1.2283 against the dollar. Against the yen, the dollar was last trading 0.8% higher at 100.83 yen.
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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.
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