Investing.com - " The euro dropped against the greenback on
Friday after data revealed the U.S. economy added far more jobs
than expected in October and fueled expectations for the Fed to
begin scaling back dollar-weakening stimulus programs in the near
In U.S. trading on Friday, EUR/USD was down 0.60% at 1.3338, up
from a session low of 1.3318 and off from a high of 1.3438.
The pair was likely to find support at 1.3298, Thursday's low, and
resistance at 1.3548, Wednesday's high.
The Bureau of Labor Statistics reported earlier that the U.S.
economy added 204,000 jobs in October, far surpassing expectations
for a 125,000 increase.
The August figure was revised to 238,000 from 193,000, while the
September figure was revised
to 163,000 from 148,000.
The U.S. unemployment rate ticked up to 7.3% last month from 7.2%
in September, in line with expectations.
The figures fueled market sentiments that the Fed could announce
plans to scale back its USD85 billion in monthly asset purchases
possibly as soon as December.
Asset purchases aim to spur recovery by driving down long-term
interest rates, weakening the dollar in the process, and talk of
their dismantling strengthens the U.S. currency.
The better-than-expected October jobs report came a day after
official data showed that the U.S. economy grew 2.8% on year in the
third quarter, well beyond expectations for 2.0% growth.
Capping the dollar's advance, however, was the Thomson
Reuters/University of Michigan's preliminary consumer sentiment
index for November, which ticked down to 72.0 from 73.2 in October,
disappointing expectations for a rise to 74.5.
The euro, meanwhile, continued to come under pressure against the
dollar after the European Central Bank on Thursday trimmed its
benchmark interest rate to a record-low 0.25% from 0.5% in an
Elsewhere, official data revealed that Germany's trade surplus
widened to EUR18.8 billion in September, from EUR15.8 billion the
previous month, which was revised up from EUR15.6 billion.
Analysts had expected the trade surplus to narrow to EUR15.5
billion in September.
The wider surplus, the product of soft imports, watered down the
euro by stoking concerns Europe's largest economy is shipping less
inputs due to soft demand for its goods and services elsewhere in
Separately, Standard & Poor's cut France's credit rating to AA
from AA+. The ratings agency said slower growth will constrain the
government's ability to improve public finances.
Elsewhere, the single currency was up against the pound and up
against the yen, with EUR/GBP trading up 0.11% at 0.8347 and
EUR/JPY trading up 0.40% at 132.16.
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