Dollar Spikes Up After Positive U.S. Data; Jobs Data Awaited
March 05 2015 - 2:16AM
RTTF2
The U.S. dollar moved up against its major counterparts in late
Asian deals on Thursday, as positive private sector jobs data and
services sector report from the U.S. overnight revived investor
bets that the Fed may raise rates by midyear. Traders now await
Friday's jobs data for more clues about the economy.
Data from payroll processor ADP showed that U.S. private sector
employment remained above 200,000 for the ninth consecutive month
in February, with an increase of 212,00 jobs.
The data signaled that the solid trend in U.S labor market is
sustaining, boosting hopes that the Fed will initiate an interest
rate hike sooner, rather than later.
The ADP figures are considered a key prelude to the official
U.S. jobs report, which comes out Friday morning from the Labor
Department. Economists predict an addition of 235,000 jobs in
February. The jobless rate is expected to decline to 5.6 percent
from 5.7 percent in January.
The U.S. service sector activity unexpectedly grew at a slightly
faster rate in the month of February, according to a report
released by the Institute for Supply Management.
The ISM said its non-manufacturing index inched up to 56.9 in
February from 56.7 in January, with a reading above 50 indicating
an expansion in service sector activity.
The Federal Reserve's Beige Book report showed that the economy
continues to expand at a moderate pace across most regions from
early January through mid-February.
Today's weekly U.S. jobless claims and monetary policy decisions
by the European Central Bank and the Bank of England are also in
focus for further direction.
The greenback that ended yesterday's trading at 119.64 versus
the yen advanced to a 2-day high of 119.90. The next possible
resistance for the greenback-yen pair is seen around the 120.7
zone.
The greenback firmed up to 1.1025 against the euro, a level
unseen since September 2003. If the greenback extends rise, 1.09 is
seen as its next resistance level.
The greenback added almost 0.3 percent to 1.5224 against the
pound, its highest since February 12. The pair was valued at 1.5263
at Wednesday's close. Extension of bullish trend may take the
greenback to a resistance around the 1.51 mark.
The greenback climbed to 0.9662 against the Swiss franc, up from
yesterday's closing value of 0.9629. Next key resistance for the
greenback may be located around the 0.98 area.
Reversing from an early low of 0.7596 against the NZ dollar, the
greenback appreciated to a 2-day high of 0.7533. The greenback is
poised to challenge resistance near the 0.74 mark.
The greenback edged up to 1.2447 against the loonie, compared to
1.2423 hit at yesterday's close. On the upside, the greenback may
test resistance around the 1.26 zone.
Looking ahead, U.K. Halifax house price index for February is
due shortly.
The Bank of England will announce its interest rate decision at
7:00 am ET. Economists expect the bank to retain interest rates
unchanged at 0.50 percent and asset purchase target at GBP 375
billion.
The European Central Bank will announce its interest rate
decision at 7:45 am ET. Economists expect the bank to retain
interest rates unchanged at 0.05 percent.
Following the announcement, central bank President Mario Draghi
will hold the customary post-meeting press conference in Cyprus at
8:30 am ET.
In the New York session, U.S. weekly jobless claims for the week
ended February 28, factory orders for January and Canada Ivey's PMI
for February are slated for release.
At 10:00 am ET, U.S. Federal Reserve Bank of San Francisco
President John Williams will deliver a speech about the economic
outlook at the Chartered Financial Analysts Society Hawaii 10th
Annual Economic Forecast Dinner, in Honolulu.
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