Tag Archives: U.S. Dollar

Dollar turns lower against euro, yen on doubts over rally’s momentum

By Sam Forgione

NEW YORK (Reuters) – The U.S. dollar lost ground against the yen and was mostly flat against the euro on Wednesday, reversing earlier gains after traders took profits on skepticism that central bank policy in the United States and elsewhere would continue to diverge.

The dollar fell to a session low of 113.23 yen after hitting a more than two-week high against the Japanese currency of 114.55 yen early in the U.S. trading session. The euro was last up slightly against the dollar at $1.0866 after hitting a more than one-month low of $1.0826 earlier.

Early in the U.S. session, data showing stronger-than-expected growth in U.S. private payrolls in February added to a recent pile of reassuring U.S. economic data and boosted expectations that the Federal Reserve would hike interest rates at least once this year.

That optimism cooled, partly on doubts that uniformly strong U.S. economic data would continue and that the European Central Bank would announce a greater stimulus package and weaken the euro at the central bank’s meeting on March 10.

“People are taking a bit of a profit after a strong ride,” said Sebastien Galy, currency strategist at Deutsche Bank in New York, in reference to the dollar’s recent gains. “Everyone knows the dollar, for good reasons, is too expensive.”

The ADP National Employment Report showed U.S. private employers added 214,000 jobs in February. That was above economists’ expectations for a gain of 190,000, according to a Reuters poll.

Uncertainty remained over the impact of low oil prices on Fed policy and China’s economic growth, leading traders to take profits in the dollar’s gains, said Sireen Harajli, currency strategist at Mizuho Bank Ltd in New York.

Harajli said uncertainty ahead of Friday’s U.S. non-farm payrolls report for February may have contributed to the reversal in the dollar’s rally. Economists polled by Reuters expect U.S. employers to have added 190,000 jobs last month.

The U.S. dollar index, which hit a roughly one-month high of 98.582 earlier, was last down 0.17 percent at 98.176 <.DXY>. The dollar was last down 0.53 percent against the yen at 113.38 yen <JPY=>.

The dollar was last down 0.07 percent against the Swiss franc at 0.9962 franc <CHF=>.

(Reporting by Sam Forgione; Editing by Lisa Von Ahn)

World Markets React Wednesday To Shutdown

The U.S. government shutdown had an impact on world markets causing concerns the country’s fragile economic condition could be severely impacted by a prolonged closure.

Stock markets in Britain, Germany and France all fell in Wednesday’s trading. U.S. markets fell as well with the Dow Jones Industrial Average falling 0.6% and the S&P 500 falling 0.8%.

Investors are paying lip service to the U.S. shutdown but have expressed more serious concerns the shutdown will result in a delay of raising the U.S. debt ceiling that would have impact on the world markets.

The dollar also continued to fall across the world. The dollar took a hit from 98.62 yen to the dollar before the shutdown to a current level of 97.74. The dollar also fell further against all other Asian currencies.

Economic Worries Drive Pound Lower

The British pound has fallen against both the U.S. dollar and the Euro on fears that the economy is weaker than previously stated by analysts.

The pound fell to a seven month low against the dollar and a 15 month low against the Euro. A Bank of England policymaker is being pointed to as a source for the drop after stating the pound needed to weaken further to improve the economy. Continue reading →