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Dollar remains lower as U.S. employment data weighs

Published 09/06/2013, 10:29 AM
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Investing.com - The U.S. dollar remained lower against the other major currencies on Friday, as the release of lower-than-expected U.S. jobs data fuelled fresh uncertainty over the Federal Reserve's next policy moves, weighing on demand for the greenback.

During U.S. morning trade, the dollar was lower against the euro, with EUR/USD gaining 0.35% to 1.3166.

In a report, the Bureau of Labor Statistics said the U.S. economy added 169,000 jobs in August, less than the expected 180,000 increase, after a downwardly revised 104,000 rise the previous month.

The report also showed that the U.S. private sector added 152,000 jobs last month, compared to expectations for a 180,000 rise, following a downwardly revised increase of 127,000 in July.

The U.S. unemployment rate ticked down to 7.3% in August, from 7.4% in July, as more people left the workforce. Analysts had expected the unemployment rate to remain unchanged last month.

The euro's gains were limited however by downbeat economic reports out of Germany. Earlier Friday, official data showed that German industrial production dropped 1.7% in July, compared to expectations for a 0.5% fall, after a downwardly revised 2% rise the previous month.

A separate report showed that Germany's trade surplus narrowed unexpectedly to EUR14.5 billion in July, from an upwardly revised surplus of EUR15.8 billion the previous month. Analysts had expected the trade surplus to expand to EUR16.1 billion in July.

The greenback was also lower against the pound, with GBP/USD rising 0.28% to 1.5633.

Official data earlier showed that U.K. manufacturing production rose 0.2% in July, confounding expectations for a 0.3% rise, after an upwardly revised 2% increase the previous month.

A separate report showed that the U.K. trade deficit widened to GBP9.85 billion in July, from a dwonwardly revised deficit of GBP8.17 billion the previous month. Analysts had expected the trade deficit to narrow to GBP8.15 billion in July.

Elsewhere, the greenback dropped against the yen and the Swiss franc, with USD/JPY tumbling 1.28% to trade at 98.82, and with USD/CHF declining 0.79% to 0.9376.

The greenback was broadly lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD plummeting 1.04% to 1.0396, AUD/USD advancing 0.88% to 0.9202 and NZD/USD rallying 1.50% to 0.8003.

In Canada, official data showed that the economy added 59,200 jobs in August, beating expectations for a 20,000 increase, after a 39,400 decline the previous month.

Canada's unemployment rate ticked down to 7.1% last month from 7.0% in July. Analysts had expected the unemployment rate to fall to 7.0% in August.

A separate report showed that Canada's Ivey purchasing managers' index rose to 51.0 in August, from a reading of 48.4 in July, confounding expectations for a rise to 52.0.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.58% to 82.20.

Market participants continued to focus on the consequences of a potential U.S. military intervention in Syria, as the U.S. government was preparing to vote next week on President Barack Obama's proposal to launch a missile strike.


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