Dollar Rises Ahead of NFP Friday

The dollar edged higher against the euro Wednesday, stabilizing after declining sharply over the past week.

The ICE U.S. Dollar Index  was up 0.2% at 95.273 as the buck made gains against the euro. The greenback was flat against the pound at $1.3339 as investors awaited Thursday’s Bank of England meeting and the central bank’s quarterly inflation report.

It remained steady after the ADP’s private-payrolls report showed 179,000 jobs were created last month, surpassing expectations for 170,000 new jobs from a FactSet survey of analysts. The ADP data are seen as an early indicator ahead of the Labor Department’s monthly jobs figure, which is expected Friday. However, the report isn’t viewed as accurate as the official Friday report.

“The market is coming off a few days of heavy dollar selling,” said Valentin Marinov, chief G-10 currency strategist at Crédit Agricole. “The big event for the dollar will remain [the July] payrolls.”

On Friday, the dollar logged its worst weekly performance since April after the Federal Reserve left interest rates unchanged and a reading on second-quarter economic growth was much weaker than expected.

Investors on Wednesday will also have data on services sector activity to consider, and Chicago Fed President Charles Evans is slated to speak to the media at 1 p.m. Eastern time.

via MarketWatch

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza