Investing.com - The dollar firmed against the yen and most other
major currencies on Thursday after official data revealed that the
U.S economy picked up more jobs in June than expected just a day
after a private-sector report revealed likewise.
In U.S. trading, USD/JPY was up 0.42% and trading at 102.20, up
from a session low of 101.77 and off a high of 102.27.
The pair was expected to test support at 101.24, Monday's low,
and resistance at 102.34, the high from June 18.
The dollar firmed after the U.S. Department of Labor reported
that non-farm payrolls rose by 288,000 in June, easily surpassing
expectations for an increase of 212,000. May's figure was revised
up to a gain of 224,000 from 217,000.
The unemployment rate ticked down to 6.1% from 6.3% in May.
Analysts had expected the jobless rate to hold steady at 6.3% last
A day earlier payroll processor ADP reported in its nonfarm
payrolls report that the U.S private sector added 281,000 jobs last
month, beating expectations for an increase of 200,000.
The numbers firmed the dollar by keeping expectations on track
for the Federal Reserve to continue tapering stimulus programs this
year and raise interest rates the next.
Fed stimulus programs such as monthly bond purchases aim to spur
recovery by suppressing long-term interest rates, weakening the
dollar as a side effect.
Also on Thursday, the Institute of Supply Management said its
non-manufacturing purchasing managers' index fell to 56.0 in June
from 56.3 in May. Analysts had expected the index to hold steady at
56.3 in June.
The yen, meanwhile, was down against the euro and down against
the pound, with EUR/JPY up 0.01% at 139.03, and GBP/JPY trading up
0.31% at 175.24.
Meanwhile in Europe, ECB President Mario Draghi reiterated the
bank's forward guidance that rates will remain on hold at present
or at lower levels for an extended period of time.
He emphasized that the governing council is also unanimous in
its commitment to use unconventional instruments if necessary, to
address the risk of too-prolonged period of low inflation.
The ECB left all rates on hold earlier Thursday, in a widely
anticipated decision, after cutting rates to record lows in
Draghi said unemployment rate in the euro zone is still too high
and warned that risks to the economy remain to the downside.
The ECB president also announced that it will shift to a
six-week meeting cycle from January 2015 and that it will start
publishing meeting minutes.
Elsewhere, Markit Economics reported that its U.K. services PMI
slowed to 57.7 in June from 58.6 in May, and below forecasts of
58.3. It was the lowest reading in three months, but remained well
above the 50 level separating growth from contraction.
New business volumes rose at their fastest rate in six months,
while the sector created jobs at a record pace.
The report added to indications that the economy was continuing
to grow strongly in the second quarter after the economy expanded
at the fastest annual rate since 2007 in the first three months of
Sterling has strengthened broadly since the start of this year,
gaining more the 13% against the dollar amid expectations that the
deepening U.K. recovery will prompt the Bank of England to raise
rates before the end of the year.
On Friday, markets in the U.S. are to remain closed for the
Independence Day holiday.
offers an extensive set of professional tools for the financial
Read more News on Investing.com and download the new
Investing.com Stocks & Forex App