Dollar remains broadly higher despite strong U.S. data

Shutterstock photo - The U.S. dollar remained broadly higher against the other major currencies on Friday, despite strong U.S. economic reports as comments by Federal Reserve officials coupled with U.S. debt concerns continued to weigh on risk sentiment.

During U.S. morning trade, the dollar was fractionally higher against the euro, with EUR/USD dipping 0.05% to 1.3043.

The euro trimmed losses against the greenback after the U.S. Institute of Supply Management said its non manufacturing index improved to 56.1 in December from a reading of 54.7 the previous month, beating expectations for a rise to 54.2.

The data came after the Bureau of Labor Statistics said the U.S. economy added 155,000 jobs in December, more than the expected 150,000 increase, after an upwardly revised 161,000 rise the previous month.

In addition, the U.S. employment rate remained unchanged at 7.8% last month, compared with expectations for a decline to 7.7%.

But markets were jittery after the minutes of the Fed's December policy meeting showed that officials began debating an end to bond-buying as early as this year even while preparing to boost stimulus to a new record.

In the euro zone, preliminary data earlier showed that consumer price inflation remained unchanged at an annualized rated of 2.2% last month. Analysts had expected consumer price inflation to tick down to 2.1% in December.

The greenback was higher against the pound, with GBP/USD dropping 0.45% to 1.6035.

Earlier in the day, Markit said that the U.K. service sector purchasing managers' index deteriorated to 48.9 in December from a reading of 50.2 the previous month, falling back into contraction territory for the first time since January 2011.

Analysts had expected the index to tick up to 50.4 last month.

Elsewhere, the greenback was higher against the yen, with USD/JPY climbing 0.85% to trade at 87.99 and almost unchanged against the Swiss franc, with USD/CHF easing up 0.01% to 0.9268.

The greenback was mixed to higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD falling 0.16% to 0.9862, AUD/USD slipping 0.18% to 1.0448 and NZD/USD edging down 0.02% to 0.8279.

In Canada, official data showed that the economy added 39,800 in December, blowing past expectations for a 5,000 rise, after a 59,300 increase the previous month.

Canada's unemployment rate ticked down to 7.1% last month from 7.2% the previous month. Analysts had expected the unemployment rate to decline to 7.0% in December.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.21% to 80.73.

Investors also remained cautious over the longer term outlook in the U.S., with negotiations on raising the debt ceiling still to come in February. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

Read more News on or Follow us on Twitter at @ Newsinvesting

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.