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Dollar gains on Friday jobs report, soft Chinese trade numbers

Published 03/10/2014, 03:35 PM
Updated 03/10/2014, 03:37 PM
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Investing.com - The dollar moved higher against most major currencies on Monday as markets continued to applaud Friday's better-than-expected February jobs report, while soft Chinese trade figures boosted the greenback as well.

In U.S. trading on Monday, EUR/USD was down 0.05% at 1.387.

The Bureau of Labor Statistics reported Friday that the U.S. economy added 175,000 jobs in February, beating expectations for a 149,000 increase.

January's figure was revised up to 129,000 from 113,000.

The data extended the dollar's gains into Monday, as the Federal Reserve has said it will pay close attention to data when deciding on how quickly it will dismantle its monthly bond-buying program.

Fed bond purchases, currently set at $65 billion a month, weaken the dollar by suppressing interest rates to spur recovery by encouraging investing and hiring.

Separately, soft Chinese trade data supported the greenback by bolstering its appeal as a safe-haven asset class.

Data released over the weekend showed that Chinese exports fell 18.1% on-year in February, defying expectations for a 6.8% increase, following a rise of 10.6% in January.

A separate report showed that the annual rate of inflation in China slowed to 2.0% in February, from 2.5% in January.

The numbers confirmed market concerns that emerging markets are cooling.

Elsewhere, the euro saw some support on market views that the European Central Bank will hold off on stimulating the economy further.

Last week, the ECB left its benchmark interest rate unchanged at 0.5%, as recent data indicated moderate economic recovery was taking place in the euro zone.

Elsewhere in Europe, investor confidence in the euro zone for March rose to its highest level since April 2011, easing concerns over the outlook for the region’s economy, data showed on Monday.

Market research group Sentix reported earlier that its index of investor confidence improved to 13.9 this month from a reading of 13.3 in February. Analysts were expecting the index to increase to 14.0 in March.

On the index, a level above 0.0 indicates optimism, below indicates pessimism.

Separately, French industrial output fell unexpectedly in January, official data showed on Monday.

In a report, INSEE said that French Industrial Production fell to -0.2% in January from -0.6% in the preceding month.

Analysts had expected French Industrial Production to rise 0.2% last month.

Elsewhere, the dollar was down against the yen, with USD/JPY down 0.06% at 103.20, and up against the Swiss franc, with USD/CHF up 0.03% at 0.8781.

In Japan, data revealed the economy grew 0.2% in the final three months of 2013, missing market calls for a 0.3% reading.

On a year-over-year basis, the economy expanded by 0.7%, missing expectations for a 1.0% reading.

The numbers softened the yen earlier though demand from investors fleeing exposure to emerging markets gave the Japanese currency support.

The greenback was up against the pound, with GBP/USD down 0.45% at 1.6640.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.14% at 1.1103, AUD/USD down 0.58% at 0.9018 and NZD/USD down 0.06% at 0.8465.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.04% at 79.90.

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