Currency news - Dollar braced for payroll report

Dollar braced for payroll report - 09-01-09

The Euro found support below the 1.3550 level inn Europe on Thursday and recovered to the 1.36 region ahead of the US open. US initial jobless claims were sharply lower than expected for the second consecutive week at 467,000 from 491,000 previously, but there were suspicions that the data had again been distorted by seasonal influences surrounding the New Year holiday. This impression was reinforced by the fact that continuing claims rose further to a fresh 26-year high.

Economic fears were reinforced by weaker than expected sales data from Wal-Mart and there was major unease over the Friday payroll data. President-elect Obama provided some details of proposed tax measures, but this failed to have a significant impact following the recent comments that the deficit is liable to exceed US$1trn.

The Euro pushed to a high of 1.38 after the US data before retreating to 1.37 and edged weaker on Friday in choppy trading conditions. The Euro found support below 1.3650 and gained after a slightly stronger than expected Euro-zone retail sales report.

Tim Clayton
Investica Ltd
E-mail: tim.clayton@investica.co.uk
+44 (0) 1452 781001

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