SYDNEY (Thomson Financial) - The U.S. dollar was trading mixed against major
currencies late morning on Monday in a narrow range, consolidating last week's
gains in thin trade due to Japan's financial markets being closed for a public
holiday.
At 10:45 am (0045 GMT) the dollar was at 105.40 yen from 105.39 yen in late
trade in New York on Friday, while the euro was at $1.5447 from $1.5424.
Better-than-expected April U.S. jobs data helped boost the dollar on Friday
as investors took the view that the U.S. economy and financial markets might
move to a recovery mode in the second half of the year.
Non-farm payrolls data released on Friday showed that 20,000 jobs were lost
in April, far less than the 75,000 drop in job numbers the market had been
expecting.
Currency strategists said U.S. data is continuing to surprise on the upside,
giving added reason for the Federal Reserve to stop cutting rates. The central
bank last Wednesday signalled that its easing cycle may be at an end even though
it cut its funds target rate a further quarter percentage point to 2.0 percent.
Before the aggressive rate cutting began in September the rate was 5.25
percent.
Andrew Spencer, a foreign exchange analyst at Thomson IFR Markets, said that
the dollar has found support as it is likely the Fed is on hold for the next few
months while there is also a widespread belief that the euro is entering a
period of significant downward correction after reaching record highs against
the greenback.
Spencer said an illiquid market due to Japan being on holiday may result in
exaggerated moves during Asian trading hours though investors are likely to be
buyers of U.S. dollars on dips.
NAB Capital Markets head of currency strategy John Kyriakopoulos said U.S.
dollar short positions have been slashed to the lowest level since Christmas
with the euro bearing the brunt of the rush back into the greenback.
He said last week euro positioning moved from neutral to underweight.
Sydney 11:45 a.m. (0045 GMT)
U.S. dollar
yen 105.40
Swiss franc 1.0549
Euro
U.S. dollar 1.5447
yen 162.795
Swiss franc 1.6291
pound 0.7822
Pound
U.S. dollar 1.9747
yen 208.095
Swiss franc 2.0825
Australian dollar
U.S. dollar 0.9355
pound 0.4737
yen 98.575
New Zealand dollar
U.S. dollar 0.7803
bruce.hextall@thomsonreuters.com
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bhx/ng
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