Investing.com - The dollar fell against the safe haven yen on Friday, but posted steep gains against its other major counterparts after disappointing U.S. employment data fuelled fears that the country’s economic recovery is losing momentum.
The Department of Labor said the U.S. economy added 115,000 jobs in last month, far short of expectations for a 170,000 increase, after adding an upwardly revised 154,000 jobs in March.
The unemployment rate ticked lower to 8.1% but the labor participation rate also declined, as fewer people sought jobs.
The weak data added to uncertainty over the strength of the U.S. recovery and fuelled speculation the Federal Reserve implement a third round of quantitative easing measures to stimulate growth.
Market sentiment was also hit by concerns over political uncertainty in the euro zone, in the run-up to weekend elections in Greece and France, amid fears that leadership changes could hinder attempts to resolve the region's debt crisis.
The euro fell to a two-week low against the greenback, while the yen ended the week trading close to a three-month high against the greenback.
Meanwhile, the growth linked Australian and New Zealand dollars fell to multi-month lows against the greenback on Friday.
Earlier in the week, the Reserve Bank of Australia surprised markets with a larger-than-expected interest rate cut to 3.75%, its lowest level since early 2010, in an attempt to boost the nation's commodity-linked economy.
In New Zealand, official data on Thursday showed that the country’s unemployment rate rose unexpectedly in the first quarter, climbing to 6.7%, against expectations for a decline to 6.3%.
Elsewhere, the pound remained supported against the greenback on Friday, with investors continuing to view sterling as a viable alternative to the euro and the dollar.
In the week ahead, investors will be closely watching election results in Greece and France, while in the U.S. a speech by Fed Chairman Ben Bernanke in Chicago on Thursday the main focus for the greenback.
China is to release a flurry of data, including reports on retail sales and inflation that will allow investors to gauge the strength of the world’s second largest economy.
In addition, the Bank of England is to announce its benchmark interest rate and any changes to the size of its asset purchase program.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, May 7
The Bank of Japan is to release the minutes of its most recent monetary policy meeting, which will provide insights into the economic conditions that influenced its latest interest rate decision.
Australia is to produce official data on building approvals and on retail sales, the primary gauge of consumer spending, followed by industry data on job advertisements and business confidence.
Markets in the U.K. are to remain closed due to a national holiday.
Elsewhere in Europe, the Swiss National Bank is to release data on foreign currency reserves. Switzerland is also to produce official data on consumer price inflation, which accounts for the majority of overall inflation.
The euro zone is to publish a report on investor confidence, while Germany is to publish official data on factory orders.
Later in the day, Canada is to produce official data on building permits, an excellent gauge of future construction.
Tuesday, May 8
Australia is to release official data on the trade balance, the difference in value between imported and exported goods. Meanwhile, the Reserve Bank of New Zealand is to produce its financial stability report.
The U.K. is to publish industry data on house price balance, a key indicator of housing inflation, while Switzerland is to produce government data on consumer climate.
In the euro zone, official data is to be released on German industrial production, a leading indicator of economic health. Later in the day, European Central Bank President Mario Draghi is due to speak in Frankfurt.
Also Tuesday, Canada is to publish industry data on housing starts, a key gauge of economic health.
Wednesday, May 9
New Zealand is to publish industry data on house price inflation, a leading indicator of the house industry’s health.
The U.K. is to release industry data on retail sales, an important indicator of economic health.
Later Wednesday, the U.S. is to produce government data on crude oil stockpiles. The country is also to hold a 10-year government bond auction
Thursday, May 10
Japan is to release government data on the country’s current account, while Australia is to publish official reports on employment change and the unemployment rate, an important signal of overall economic health.
In the euro zone, official data is to be produced on French industrial production, followed by the ECB’s monthly bulletin.
The U.K. is to publish official data on manufacturing production, a key indicator of economic health, as well as a monthly estimate of gross domestic product by the National Institute of Economic and Social Research. Also Thursday, the BoE is to announce its benchmark interest rate.
Later in the day, Canada is to release official data on the trade balance.
The U.S. is also to produce official data on trade balance, followed by government reports on unemployment claims and import prices. The country is also to release government data on the federal budget balance and the Treasury currency report, while Federal Reserve Chairman Ben Bernanke is due to speak. His comments will be closely watched for any clues to the future possible direction of monetary policy.
Friday, May 11
The U.K. is to publish official data on producer price inflation input, a leading indicator of consumer inflation.
Meanwhile, Canada is to release an official report on employment change and the unemployment rate.
The U.S. is to round up the week with government data on producer price inflation, a key gauge of consumer inflation, followed by a preliminary report by the University of Michigan on consumer sentiment, a leading indicator of consumer spending.
The Department of Labor said the U.S. economy added 115,000 jobs in last month, far short of expectations for a 170,000 increase, after adding an upwardly revised 154,000 jobs in March.
The unemployment rate ticked lower to 8.1% but the labor participation rate also declined, as fewer people sought jobs.
The weak data added to uncertainty over the strength of the U.S. recovery and fuelled speculation the Federal Reserve implement a third round of quantitative easing measures to stimulate growth.
Market sentiment was also hit by concerns over political uncertainty in the euro zone, in the run-up to weekend elections in Greece and France, amid fears that leadership changes could hinder attempts to resolve the region's debt crisis.
The euro fell to a two-week low against the greenback, while the yen ended the week trading close to a three-month high against the greenback.
Meanwhile, the growth linked Australian and New Zealand dollars fell to multi-month lows against the greenback on Friday.
Earlier in the week, the Reserve Bank of Australia surprised markets with a larger-than-expected interest rate cut to 3.75%, its lowest level since early 2010, in an attempt to boost the nation's commodity-linked economy.
In New Zealand, official data on Thursday showed that the country’s unemployment rate rose unexpectedly in the first quarter, climbing to 6.7%, against expectations for a decline to 6.3%.
Elsewhere, the pound remained supported against the greenback on Friday, with investors continuing to view sterling as a viable alternative to the euro and the dollar.
In the week ahead, investors will be closely watching election results in Greece and France, while in the U.S. a speech by Fed Chairman Ben Bernanke in Chicago on Thursday the main focus for the greenback.
China is to release a flurry of data, including reports on retail sales and inflation that will allow investors to gauge the strength of the world’s second largest economy.
In addition, the Bank of England is to announce its benchmark interest rate and any changes to the size of its asset purchase program.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, May 7
The Bank of Japan is to release the minutes of its most recent monetary policy meeting, which will provide insights into the economic conditions that influenced its latest interest rate decision.
Australia is to produce official data on building approvals and on retail sales, the primary gauge of consumer spending, followed by industry data on job advertisements and business confidence.
Markets in the U.K. are to remain closed due to a national holiday.
Elsewhere in Europe, the Swiss National Bank is to release data on foreign currency reserves. Switzerland is also to produce official data on consumer price inflation, which accounts for the majority of overall inflation.
The euro zone is to publish a report on investor confidence, while Germany is to publish official data on factory orders.
Later in the day, Canada is to produce official data on building permits, an excellent gauge of future construction.
Tuesday, May 8
Australia is to release official data on the trade balance, the difference in value between imported and exported goods. Meanwhile, the Reserve Bank of New Zealand is to produce its financial stability report.
The U.K. is to publish industry data on house price balance, a key indicator of housing inflation, while Switzerland is to produce government data on consumer climate.
In the euro zone, official data is to be released on German industrial production, a leading indicator of economic health. Later in the day, European Central Bank President Mario Draghi is due to speak in Frankfurt.
Also Tuesday, Canada is to publish industry data on housing starts, a key gauge of economic health.
Wednesday, May 9
New Zealand is to publish industry data on house price inflation, a leading indicator of the house industry’s health.
The U.K. is to release industry data on retail sales, an important indicator of economic health.
Later Wednesday, the U.S. is to produce government data on crude oil stockpiles. The country is also to hold a 10-year government bond auction
Thursday, May 10
Japan is to release government data on the country’s current account, while Australia is to publish official reports on employment change and the unemployment rate, an important signal of overall economic health.
In the euro zone, official data is to be produced on French industrial production, followed by the ECB’s monthly bulletin.
The U.K. is to publish official data on manufacturing production, a key indicator of economic health, as well as a monthly estimate of gross domestic product by the National Institute of Economic and Social Research. Also Thursday, the BoE is to announce its benchmark interest rate.
Later in the day, Canada is to release official data on the trade balance.
The U.S. is also to produce official data on trade balance, followed by government reports on unemployment claims and import prices. The country is also to release government data on the federal budget balance and the Treasury currency report, while Federal Reserve Chairman Ben Bernanke is due to speak. His comments will be closely watched for any clues to the future possible direction of monetary policy.
Friday, May 11
The U.K. is to publish official data on producer price inflation input, a leading indicator of consumer inflation.
Meanwhile, Canada is to release an official report on employment change and the unemployment rate.
The U.S. is to round up the week with government data on producer price inflation, a key gauge of consumer inflation, followed by a preliminary report by the University of Michigan on consumer sentiment, a leading indicator of consumer spending.