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FOREX-Dollar weakens as strong U.S. jobs data dims haven appeal

Published 02/07/2020, 14:59
Updated 02/07/2020, 15:00
© Reuters.

© Reuters.

* U.S. economy creates 4.8 mln jobs
* Safe-haven dollar also hurt by vaccine news
* Dollar on pace to post losses for 2nd straight week
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

(Adds analyst comment, more details on jobs report, updates prices)
By Gertrude Chavez-Dreyfuss
NEW YORK, July 2 (Reuters) - The U.S. dollar fell on Thursday after data showing the world's largest
economy defying expectations for a second month in a row, creating jobs in June at a far faster pace than
market forecasts.
The greenback was on track to post losses for a second straight week against a basket of major
currencies.
Data showed that U.S. nonfarm payrolls increased by 4.8 million jobs in June, the most since the
government started keeping records in 1939. Payrolls rebounded 2.699 million in May. Economists polled by
Reuters had forecast payrolls increasing by 3 million jobs in June. The unemployment rate, meanwhile, fell to 11.1% last month from 13.3% in May.
The report further diminished the dollar's appeal as a safe haven.
"Everything still seems to be heading in the right direction. Right now, expectations are pretty high
that the economy is rebounding back," said Edward Moya, senior market strategist at OANDA in New York.
In midmorning trade, the dollar index slid 0.1% to 97.064 =USD , as the euro rose 0.1% versus the
greenback to $1.1262 EUR=EBS .
Traders are focused on whether the euro can close above $1.13 and OANDA's Moya said it could happen.
"This is going to support the belief that a massive weakening in the U.S. dollar is upon us because
there's still optimism that risky assets are going to shine because the Federal Reserve is going to remain
very accommodative," Moya said.
Despite the dollar's recent spell of weakness, the greenback is still up 2.5% from the 2020 low of
94.6 in the dollar index hit in early March. A Reuters poll predicts more weakness for the greenback over
the next 12 months due to weak global demand. The dollar, however, gained 0.1% against the yen to 107.59 yen JPY=EBS .
The U.S. currency had been buffeted earlier in the session by news that a COVID-19 vaccine developed
by German biotech firm BioNTech BNTX.O and U.S. pharmaceutical giant Pfizer PFE.N had shown potential
in early-stage human trials. Currency bid prices at 9:41AM (1341 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1263 $1.1250 +0.12% +0.47% +1.1302 +1.1248
Dollar/Yen JPY= 107.5800 107.4600 +0.11% -1.18% +107.7200 +107.3400
Euro/Yen EURJPY= 121.17 120.90 +0.22% -0.64% +121.4300 +120.7700
Dollar/Swiss CHF= 0.9446 0.9457 -0.12% -2.40% +0.9464 +0.9427
Sterling/Dollar GBP= 1.2491 1.2470 +0.17% -5.79% +1.2529 +1.2462
Dollar/Canadian CAD= 1.3578 1.3585 -0.05% +4.56% +1.3611 +1.3564
Australian/Doll AUD= 0.6932 0.6914 +0.26% -1.27% +0.6943 +0.6905
ar
Euro/Swiss EURCHF= 1.0639 1.0640 -0.01% -1.96% +1.0661 +1.0639
Euro/Sterling EURGBP= 0.9015 0.9018 -0.03% +6.64% +0.9032 +0.9006
NZ NZD= 0.6521 0.6475 +0.71% -3.19% +0.6536 +0.6475
Dollar/Dollar
Dollar/Norway NOK= 9.4753 9.5133 -0.40% +7.94% +9.5302 +9.4396
Euro/Norway EURNOK= 10.6716 10.7025 -0.29% +8.47% +10.7260 +10.6480
Dollar/Sweden SEK= 9.2943 9.3064 -0.03% -0.56% +9.3157 +9.2378
Euro/Sweden EURSEK= 10.4689 10.4716 -0.03% +0.00% +10.4811 +10.4313


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