Reuters: US Dollar Report: FOREX-Dollar rallies broadly, lifted by upbeat U.S. data

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

FOREX-Dollar rallies broadly, lifted by upbeat U.S. data Oct 3rd 2012, 17:56 Wed Oct 3, 2012 1:56pm EDT * ADP report showed U.S. added 162,000 private-sector jobs * Investors uncertain about Spanish bailout, euro slips * U.S. job outlook still gloomy, dollar upside limited By Steven C. Johnson NEW YORK, Oct 3 (Reuters) - The dollar rose on Wednesday after data showed U.S. companies added more jobs than expected last month, boosting some hopes that the health of the world's largest economy was improving. A separate report showing the vast U.S. services sector gained momentum in September also helped lift the greenback to a two-week high against the yen and buoyed it against sterling and commodity-sensitive currencies from Australia and New Zealand. Few analysts, though, were ready to say the U.S. job market had improved enough to reduce the jobless rate significantly,. That means the Federal Reserve is likely to flood the market with dollars for years to come, keeping the currency's gains in check. The ADP National Employment Report showed the private sector added 162,000 jobs last month. The report has proved a poor indicator of late in predicting job gains in the more comprehensive government payrolls report, which is due Friday. "ADP could foreshadow a good number, but even if we exceed expectations, job creation will still be miserable and will give the Fed plenty of scope to keep easing," said John Doyle, currency strategist at Tempus Consulting in Washington. The dollar was last up half a percent at 78.51 yen after hitting its highest level since Sept. 19 following the data. Strategists tied the move partly to Japan's new finance minister saying he was ready to take steps to thwart a strong yen, which has hurt exports and the economy. Jamie Coleman, currency strategist at Forexlive.com in Boston, cited bankers as he noted an uptick in speculative demand for dollar/yen on an improving technical backdrop. "It lulls you to sleep when the same person says these things over and over again, but when a new minister comes in, people tend to listen more," Doyle said. He added that he did not see the dollar making a run at the 80 yen level any time soon. The euro slipped 0.1 percent to $1.2902, as uncertainty grew about whether and when Spain would seek emergency aid to stem its debt crisis. Prime Minister Mariano Rajoy quashed speculation that his government would apply for a bailout as soon as this weekend. Data suggesting the 17-country euro zone likely fell back into recession in the third quarter also hurt the currency ahead of Thursday's European Central Bank meeting. EURO GAINS SEEN LIMITED, AUSSIE WILTS Strategists expect Spain to ultimately request a bailout, which would free the European Central Bank to buy Spanish government bonds to lower the government's borrowing costs. Such a move was expected to spark only mild euro gains. "The bailout is priced into the market, so an official request would only give the euro a short-term boost rather than see it trend higher against the dollar," said Gareth Sylvester, senior currency strategist at Klarity FX in San Francisco. Some traders said the currency could soon test $1.2968, a level hit a week ago, before hitting $1.30. Sterling fell 0.3 percent to $1.6080 ahead of a Bank of England meeting on Thursday. The Australian dollar fell 0.5 percent to $1.0220, weighed down by stronger U.S. data and a report showing Australia posted its widest trade deficit in 3-1/2 years as falling iron ore and coal prices dented export earnings. The Aussie was also weighed down by expectations that domestic interest rates will be cut further, after the Reserve Bank of Australia on Tuesday cut its cash rate by 25 basis points to 3.25 percent, the lowest level in three years. Against the Canadian dollar, the U.S. dollar hit an almost one-month high of C$0.9884, while the New Zealand dollar fell 1 percent to $0.8193. Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions