US Session – Euro holds gains after Draghi, dollar weighed by poor ADP jobs data
October 2, 2013 6:56 pm
The euro surged 100 pips against the dollar to pierce $1.36 in the early US session trading on Wednesday during ECB Mario Draghi’s press conference. Draghi was speaking after the ECB policy meeting where the central bank left the key interest rate unchanged at 0.50 percent.
Adding to euro demand was news today that the political crisis in Italy is over after Prime Minister Enrico Letta won a vote of confidence.
Helping boost the euro is a broadly weaker dollar which is being hurt by the US government shutdown. Day two of the shutdown and no clear end in sight has made investors begin getting nervous and hence are unwilling to buy the dollar.
As is widely known by now, the US Congress failed to reach an agreement on Monday to pass a spending bill that would fund the US Federal government operations for the new fiscal year and resulted in the government shutdown.
Also weighing on the dollar was US data today showing that ADP jobs numbers were lower than expected. US private sector added fewer than expected jobs in September, with 166,000 jobs created compared to 177,000 forecast. This added to concerns about the economic impact of the US budget standoff.
Meanwhile the all-important nonfarm payrolls will unlikely be released as was scheduled on Friday due to the government shutdown. This jobs report is seen as the key barometer of the US economy. The following levels were reached by major G10 currency pairs in the US session today:
EURUSD hit a 7-month high of $1.3606 from a low of $1.3504, and consolidated near the highs during the US session.
USDJPY extended lower to 97.13 yen and has been pretty much ranging during the European and US session, capped below 97.57 yen.
EURJPY jumped from 131.40 to 132.49, helped higher by a broadly stronger euro and the jump in EURUSD.
GBPUSD rose to a high of $1.6247 before easing to $1.6205.
The euro surged 100 pips against the dollar to pierce $1.36 in the early US session trading on Wednesday during ECB Mario Draghi’s press conference. Draghi was speaking after the ECB policy meeting where the central bank left the key interest rate unchanged at 0.50 percent.
Adding to euro demand was news today that the political crisis in Italy is over after Prime Minister Enrico Letta won a vote of confidence.
Helping boost the euro is a broadly weaker dollar which is being hurt by the US government shutdown. Day two of the shutdown and no clear end in sight has made investors begin getting nervous and hence are unwilling to buy the dollar.
As is widely known by now, the US Congress failed to reach an agreement on Monday to pass a spending bill that would fund the US Federal government operations for the new fiscal year and resulted in the government shutdown.
Also weighing on the dollar was US data today showing that ADP jobs numbers were lower than expected. US private sector added fewer than expected jobs in September, with 166,000 jobs created compared to 177,000 forecast. This added to concerns about the economic impact of the US budget standoff.
Meanwhile the all-important nonfarm payrolls will unlikely be released as was scheduled on Friday due to the government shutdown. This jobs report is seen as the key barometer of the US economy.
The following levels were reached by major G10 currency pairs in the US session today:
EURUSD hit a 7-month high of $1.3606 from a low of $1.3504, and consolidated near the highs during the US session.
USDJPY extended lower to 97.13 yen and has been pretty much ranging during the European and US session, capped below 97.57 yen.
EURJPY jumped from 131.40 to 132.49, helped higher by a broadly stronger euro and the jump in EURUSD.
GBPUSD rose to a high of $1.6247 before easing to $1.6205.
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