© Reuters. US dollar bills are shown in this illustration, taken on February 14, 2022. REUTERS / Dado Ruvic / Illustration
By Tom Westbrook
SINGAPORE (Reuters) – The dollar faltered toward its first stable week in three on Friday as traders looked at U.S. job data to get clues as to how far and fast the Federal Reserve could raise interest rates.
Markets have locked in consecutive 50 basis point Fed hikes in June and July, but the dollar has been pushed around this week by uncertainty about what will happen next.
The dollar rose through the early part of the week on nerves, with record high inflation in Europe warning of sharply higher exchange rates everywhere. But it fell Thursday and shares rose as mixed U.S. economic data confused the outlook.
The dollar offset these losses on Friday, sitting at $ 1.0750 per euro, weekly, and 129.85 yen, a gain of about 2%.
Asian trade was thinned out by holidays in China and Hong Kong, and a holiday in the UK is likely to ease things further while traders wait for US employment data at 1 p.m. 1230 GMT.
Low volume exaggerated a jump in, which was last up about 0.3% to 6.6329 per dollar.
“Stock markets are pushing higher,” said Chris Weston, head of research at brokerage firm Pepperstone in Melbourne. “I think the stock market is actually the horse, and the dollar in this case is the cart.”
On Thursday, 1.8 per cent rose. [.N]
The risk-sensitive Australian and New Zealand dollars each reached several-week highs and appear to be ready for weekly gains. After breaking resistance of $ 0.72, it is reaping support ahead of an expected rate hike next week. [AUD/]
It was flat at 101.76 through the Asia session and is very marginally higher on the week – stopping a decline after two consecutive weekly losses of more than 1%.
The yen has been kept under pressure by super low interest rates in Japan and little chance of them following the rest of the world higher, which is responsible for its weekly losses.
Thursday data showed a softer-than-expected increase in private employment in the U.S., along with a surprising drop in the number of unemployment benefit applications.
U.S. non-agricultural wage data comes later on Friday, and while markets and central banks are currently focusing on inflation, the labor market will guide wage expectations and sentiment about the strength of the broader economy.
“For equities right now, anything that can be seen as a cap on the Fed’s tightening can be considered supportive,” said ING economist Rob Carnell, adding that government bonds and foreign exchange markets were likely to take their signals off equities.
Sterling held gains of $ 1.2569. In cryptocurrencies, bitcoin hovered around $ 30,000.
================================================ ======
Currency bid prices at 0519 GMT
Description RIC Last US Close Pct Change YTD Pct High Bid Low Bid
Previous change
Session
Euro / dollar
$ 1.0749 $ 1.0746 + 0.02% + 0.00% +1.0765 +1.0745
Dollar / Yen
129.8500 129.8700 -0.09% + 0.00% +130.0300 +129.7550
Euro / Yen
139.58 139.59 -0.01% + 0.00% +139.7700 +139.4800
Dollar / Swiss
0.9579 0.9576 + 0.02% + 0.00% +0.9580 +0.9568
Sterling / Dollar
1.2567 1.2578 -0.07% + 0.00% +1.2590 +1.2569
Dollar / Canadian
1.2571 1.2568 + 0.03% + 0.00% +1.2578 +1.2558
Aussie / dollar
0.7254 0.7265 -0.15% + 0.00% + 0.7283 + 0.7253
NZ
Dollar / dollar 0.6553 0.6558 -0.06% + 0.00% +0.6576 +0.6553
All stains
Tokyo places
Europe stains
Volatilities
Tokyo Forex market information from BOJ
