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Forex - Dollar just below 4-year highs, nonfarm payrolls on tap

Published 10/02/2014, 10:47 AM
Dollar remains supported just under 4-year peak ahead of U.S. jobs report
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Investing.com - The U.S. dollar remained just below four-year highs against a basket of other major currencies on Thursday, as the release of positive U.S. jobless claims data lent support ahead of a highly anticipated report on U.S. employment due on Friday.

In a report, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending September 27 decreased by 8,000 to 287,000 from the previous week’s revised total of 295,000.

Analysts had expected jobless claims to rise by 2,000 to 297,000 last week.

The data came after payroll processor ADP on Wednesday said that the U.S. private sector added 213,000 jobs last month, slightly ahead of expectations for jobs growth of 210,000.

Investors were now looking ahead to Friday’s U.S. nonfarm payrolls report, which was expected to show that the economy added more than 200,000 jobs for a sixth successive month in August.

EUR/USD hit session highs of 1.2691, and was last up 0.26% to trade at 1.2651

The euro found support after the European Central Bank held back from announcing additional easing measures in spite of growing concerns over the threat of deflation in the euro area.

ECB President Mario Draghi reiterated that the bank is unanimous in its commitment to using additional unconventional measures if necessary.

Draghi said the bank's new covered bond operation will start in October and its asset purchase program will begin in the fourth quarter of this year. The programs are to run for two years and will substantially increase the ECB’s balance sheet, he said.

The programs will also help get inflation back to the ECB’s long term target of 2%, Draghi said.

The ECB held its benchmark interest rate at a record-low 0.05%, its marginal lending rate at 0.30% and left its deposit facility rate unchanged at -0.20%.

GBP/USD declined 0.34% to nearly one-month lows at 1.6129, even as data showed that U.K. construction sector activity expanded at the fastest rate in eight months in September

In a report, Markit research group said the U.K. construction purchasing managers' index increased to 64.2 last month from a reading of 64.0 in August. Economists had expected the index to fall to 63.5 in September.

USD/JPY hit lows of 108.33, before retracing some of those losses to trade at 108.55, down 0.31% for the day, while USD/CHF edged down 0.12% to 0.9548.

Elsewhere, AUD/USD gained 0.48% to 0.8775 and NZD/USD advanced 0.83% to trade at 0.7850, while USD/CAD eased 0.09% to 1.1153.

Official data earlier showed that Australian building approvals increased by 3.0% in August, exceeding expectations for a 1.0% rise, while Australia's trade deficit narrowed less than expected to A$0.79 billion in August from A$1.08 billion in July.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.16% to 85.87, off Tuesday’s peaks of 86.34, a high last seen in June 2010.

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