Jobs data hurts USD

Story link: Jobs data hurts USD

The US dollar saw declines after a private report showed more job losses in the US in June.

A private report from ADP Employer Services said that there were 79,000 fewer jobs in the US last month, a day ahead of the Labor Department’s employment report for the month.

The greenback was also hurt by predictions that the Federal Reserve will hold interest rates steady at its next meeting, while it is widely anticipated that the European Central Bank will raise Eurozone interest rates when it meets Thursday.

The expectation of an ECB rate hike was based on news reports of comments pointing that direction by ECB president Jean-Claude Trichet.

In late-morning trade in New York, the dollar traded at $1.5868 to the euro while it took ¥106.0300 to buy a dollar and ¥168.2431 to buy a euro.

The Canadian dollar also gained on the US dollar, to C$1.0154 to the dollar, based on the new jobs numbers.

The pound, meanwhile, weakened on the failure of home builder Taylor Wimpey (LSE: TW) to raise capital and as the UK construction sector contracted at its fastest rate in 11 years in June as mortgage approvals dropped again in May and home values were down again in June, leaving little expectation that the Bank of England will raise interest rates soon.

Losses for the pound were tempered by jobs data out of the United States, and at late morning in New York the pound traded at 79.65p to the euro while it took $1.9921 to buy a pound.

The South African rand strengthened versus the US dollar on expectations that higher oil prices will lead to higher interest rates there, where rates already stand at 12 percent.

The rand gained to R7.8235 to the US dollar even though South African consumer sentiment is down and motor vehicles sales dropped 22 percent on an annualized rate in June.

The Australian dollar also gained on the greenback, to 96.26 cents US to the Aussie, on new data showing that retail sales there were up 0.7 percent in May, from April’s numbers.