The U.S. dollar trudged on to post its first weekly advance in four weeks as investors speculated that the Federal Reserve will hike interest rates sooner than expected due to strong economic data.
The Bloomberg Dollar Spot Index, which monitors the U.S. currency versus 10 main counterparts, remained slightly unchanged at 10007.44 by 1:23 a.m. in Friday trading in London. The dollar plunged 0.1 percent to trade at 102.06 yen from 102.27 yen a day earlier, the strongest level since June 18. The greenback fell 0.2 percent to $1.3589 per euro while the euro fell 0.3 percent to steady at 138.69 yen.
The dollar got a boost from Thursday data that indicated that nonfarm payrolls in U.S. surged more than analysts had expected while unemployment rate declined to the lowest level in nearly six years. Employers hired 288,000 workers last month, reported the Labor Department. This exceeded the median projection of 215,000 workers in a Bloomberg survey. The jobless rate slid to 6.1 percent in June from 6.3 percent a month ago.
“Payrolls is always the figure the market looks to for depth of recovery and that obviously is important to the Fed,” Neil Mellor, a London-based forex strategist at Bank of New York Mellon spoke to Bloomberg. “It’s really a question of when the dollar is going to put in a sustained burst higher. The moment hasn’t yet arrived where we’ll see a sustained recovery but it’s one step closer.”
The Swedish krona extended its losses for the fourth straight day after factory output declined. The krona fell 0.4 percent to trade at 6.8534 per dollar after earlier declining to 6.8760, the lowest level in two years.
The Swedish currency also declined 0.3 percent to go for 9.3134 per euro after local factories reported 3.2 percent decline in output in May after earlier reporting an expansion of 2.8 percent in April, reported Statistics Sweden. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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