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FOREX-Dollar on backfoot against euro after U.S. jobs report

· 02/05/2021 10:33
FOREX-Dollar on backfoot against euro after U.S. jobs report

Revises throughout, updates prices, market activity and comments, adds byline, NEW YORK dateline

Euro up 0.6%

Dollar index down 0.5%

Jobs report stops dollar run

Year-to-date dollar index up 1.3%

By David Henry and Ritvik Carvalho

- The dollar lost out to the euro after Friday's U.S. jobs report suggested that some traders may have over-egged a stronger American recovery from the coronavirus pandemic.

The euro EUR=EBS rose 0.6% against the dollar, its biggest daily gain in two weeks after the report, which Marc Chandler, strategist at Bannockburn Global Forex, said did more to force short-term traders to adjust long-dollar and short-euro positions than it changed the economic outlook for a U.S. recovery that is stronger than peers.

The dollar index =USD of a basket of currencies was down 0.4%, but still holding a weekly gain of 0.7%.

"This forces some of the late dollar-longs out," Chandler said. "It doesn't really change what to expect for Q1 GDP in the U.S. Market positioning is a different story."

The report showed U.S. employment growth rebounded less than expected in January and job losses the prior month were deeper than initially thought, strengthening the argument for additional relief money to aid the recovery from the COVID-19 pandemic. nL1N2KA34D

The greenback was off 0.1% against the yen JPY=D3 at 105.43.

The slight change against the yen, Chandler said, was consistent with yields on U.S. Treasuries initially changing little in reaction to the report and the support it gives for additional government stimulus spending. nL1N2KB0UF

Analysts and investors have been weighing whether dollar strength this year has been a temporary reaction to a 7% loss in 2020 or is a longer-lasting shift away from dollar pessimism.

The dollar index is still up 1.3% this year. Its rise has been supported by higher longer-term U.S. Treasury yields, which prompted traders to position for massive fiscal spending.

The gauge rose in each of the first four days this week and before the jobs report was on track for a 1.1% weekly advance, the most since Nov. 1.

========================================================

Currency bid prices at 10:17AM (1517 GMT)

Description

RIC

Last

U.S. Close
Previous
Session

Pct Change

YTD Pct
Change

High Bid

Low Bid

Dollar index

=USD

91.1290

91.5270

-0.43%

1.276%

+91.6000

+91.0820

Euro/Dollar

EUR=EBS

$1.2025

$1.1961

+0.54%

-1.58%

+$1.2033

+$1.1952

Dollar/Yen

JPY=D3

105.4200

105.5400

-0.10%

+2.07%

+105.7600

+105.3350

Euro/Yen

EURJPY=

126.77

126.25

+0.41%

-0.12%

+126.9400

+126.1700

Dollar/Swiss

CHF=EBS

0.9003

0.9044

-0.44%

+1.77%

+0.9045

+0.8999

Sterling/Dollar

GBP=D3

$1.3731

$1.3673

+0.43%

+0.51%

+$1.3736

+$1.3666

Dollar/Canadian

CAD=D3

1.2782

1.2824

-0.32%

+0.38%

+1.2832

+1.2780

Aussie/Dollar

AUD=D3

$0.7646

$0.7601

+0.61%

-0.59%

+$0.7655

+$0.7583

Euro/Swiss

EURCHF=

1.0826

1.0816

+0.09%

+0.18%

+1.0833

+1.0808

Euro/Sterling

EURGBP=

0.8754

0.8749

+0.06%

-2.05%

+0.8764

+0.8739

NZ Dollar/Dollar

NZD=D3

$0.7191

$0.7157

+0.48%

+0.14%

+$0.7195

+$0.7136

Dollar/Norway

NOK=D3

8.5525

8.6420

-1.08%

-0.44%

+8.6445

+8.5425

Euro/Norway

EURNOK=

10.2869

10.3350

-0.47%

-1.72%

+10.3435

+10.2620

Dollar/Sweden

SEK=

8.3986

8.4627

-0.20%

+2.47%

+8.4816

+8.3879

Euro/Sweden

EURSEK=

10.0970

10.1170

-0.20%

+0.20%

+10.1410

+10.0890


World FX rateshttps://tmsnrt.rs/2RBWI5E

Dollar on course for best week in 3 monthshttps://tmsnrt.rs/3axHSYM

(Reporting by David Henry in New York and Ritvik Carvalho in London; Additional reporting by Kevin Buckland in Tokyo; Editing by Larry King and Alexander Smith)

((David.Henry@thomsonreuters.com; +1-332-219-1974; Reuters Messaging: david.henry.thomsonreuters.com@reuters.net))