The dollar rises, but slight pressure remains ahead of “Super Thursday” By Investing.com
By Gina Lee
Investing.com – The dollar was higher Monday morning in Asia. However, a weaker-than-expected US employment report for May put the greenback under slight pressure as the week opens.
The following the greenback against a basket of other currencies rose 0.06% to 90.185 at 10:54 p.m. ET (2:54 a.m. GMT).
The pair advanced 0.08% to 109.57.
The pair edged down 0.03% to 0.7735 and the pair edged down 0.11% to 0.7023.
The pair edged up 0.11% to 6.4017. The yuan made a comeback to trade stronger than 6.4 per dollar again and last bought 6.3880 offshore. this is due later today on the fundamental forces behind the recent rapid rise in the yuan.
The pair edged down 0.09% to 1.4142.
rose 559,000 in May according to Friday’s US jobs report, below the 650,000 forecast prepared by Investing.com but above the 278,000 readings in April.
May was 5.8% better than expected, and the data helped allay concerns about the US Federal Reserve’s earlier-than-expected asset reduction at this time.
“The slightly weaker-than-expected US employment figures for May will set the tone for the coming weeks… this provides an excuse for the (Fed) to say that substantial progress towards its targets have not been made and to postpone the reduction debate a bit longer, ”ING Bank analysts said in a note.
Concerns had prompted a slight increase in short bets against the dollar over the past week, although Fed officials maintained that the economic recovery after COVID-19 still has a long way to go and that they are ‘expected to maintain their current accommodative policy.
Investors are now focusing on numbers expected later in the week. The numbers could influence the Fed’s next move, as it further assesses current pricing pressures. A lower than expected figure could mean further declines for the US dollar.
Investors are also awaiting the latest policy decision from the European Central Bank (ECB), due on Thursday, with the Fed’s own meeting scheduled for June 15-16.
The focus will be on whether the ECB will start scaling back its bond buying program.
“Assuming the dollar bears can pass the US CPI Super Thursday and the ECB’s policy decision unscathed, the dollar could remain softly offered in the major event risk of the month which is the FOMC’s decision,” added the ING note.
“The ECB is a bit trapped… the outlook is gradually improving and financial conditions are also still largely conducive to the recovery,” Rabobank analysts said in their own note.
However, this is in part due to the steadfast attitude of several members, paving the way for a debate within the meeting that could lead to a slight slowdown in the pace of bond purchases, the note added.
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