FOREX-U.S. economic data pushes dollar down vs euro, yen
By Steven C. Johnson | Reuters – 2 hours 35 minutes ago* Weak U.S. jobs, services data adds to dollar's woes
* Euro hits 17-month high but fades ahead of ECB meeting
* Dollar at 6-week low vs yen; high-yield FX struggles
* ECB still seen outpacing Fed on rate hikes (Recasts, updates prices, adds U.S. data, comment)
NEW YORK, May 4 (Reuters) - The dollar fell to a fresh three-year low on Wednesday and the euro briefly rose above $1.49 as weaker-than-expected U.S. employment data convinced investors that U.S. interest rates would remain low this year.
The yen also hit a six-week high against the dollar after data showed the pace of growth in the dominant U.S. services sector also slowed unexpectedly in April, another sign the U.S. economy may be hitting a soft patch. See [ID:nN04186623]
With markets worried about a yawning U.S. budget deficit, traders said signs of slower growth will only add to trouble for the dollar, which fell to a three-year low against major currencies Wednesday. It has lost 7.7 percent in 2011. <.DXY>
"The dollar got beat up pretty badly against the euro," said Firas Askari, head of foreign exchange trading at BMO Capital Markets. "The U.S. fiscal situation is a concern. Now it seems the U.S. economy isn't just tepid but actually cooling off again. That's not encouraging."
But Askari and others said concerns about slower U.S. growth also dulled appetite for commodities and higher-yield assets for fear a U.S. slump would reverberate globally.
That sent the safe-haven Swiss francto a record high against the greenback and drove the U.S. currency up against the Canadian dollar . Canada's economy is heavily depend on exports to its southern neighbor.
EURO SUPPORT
The euro remained fairly well supported in anticipation of higher euro zone interest rates and strong sovereign demand. Investors brushed off news that Portugal had become the third euro zone country in the last year to need a bailout and drove the euro to $1.4939, a 17-month high. It later eased to $1.4860, up 0.3 percent and about a cent above the day's low.
Traders said a move above $1.50 was likely but would probably have to wait until after Thursday's European Central Bank meeting, which should offer clues on future rate hikes.
The ECB raised rates in April for the first time since 2008 and is expected to do so again this year to tame inflation, even as higher rates make it more difficult for countries such as Portugal to service their debts. [ID:nLDE7422CB]
"The currency market seems to have learnt to live with the struggles of the peripheral euro zone nations." said Audrey Childe-Freeman, currency strategist at JP Morgan Private Bank.
Markets do not expect the Fed to raise rates from near zero until the middle of 2012. <0#FF:>
YEN STRENGTHENS
The dollar fell 0.3 percent to 80.68 yen. If it falls further, analysts said it could put markets on alert for official intervention to slow the pace of yen gains.
Major central banks actively sold the yen earlier this year after it hit a record high against the dollar. A strong yen could hurt Japan's export-led economy as it struggles with slow growth and the aftermath of March's earthquake and tsunami.
"People are watching that 80 level, which isn't very far away," said BNY Mellon strategist Michael Woolfolk.
The Australian dollarfell 0.8 percent to $1.0754, retreating from a post-float high above $1.10 as a decline in silver weakened demand for commodity-sensitive currencies.
Some gauges of market positioning suggest speculators and hedge funds are heavily short the dollar, leaving open the possibility of more position unwinding.
But the U.S. dollar has been unable to build on short-covering support seen in past days, and investors are likely to look for fresh selling opportunities.
"There are still no big incentives to go short euros," said Roberto Mialich, strategist at Unicredit in Milan. "At the end of the day, the dollar will be sold again, and it's just a matter of time for a test of $1.50." (Additional reporting by Naomi Tajitsu in London; Editing by Andrea Ricci)
* Euro hits 17-month high but fades ahead of ECB meeting
* Dollar at 6-week low vs yen; high-yield FX struggles
* ECB still seen outpacing Fed on rate hikes (Recasts, updates prices, adds U.S. data, comment)
NEW YORK, May 4 (Reuters) - The dollar fell to a fresh three-year low on Wednesday and the euro briefly rose above $1.49 as weaker-than-expected U.S. employment data convinced investors that U.S. interest rates would remain low this year.
The yen also hit a six-week high against the dollar after data showed the pace of growth in the dominant U.S. services sector also slowed unexpectedly in April, another sign the U.S. economy may be hitting a soft patch. See [ID:nN04186623]
With markets worried about a yawning U.S. budget deficit, traders said signs of slower growth will only add to trouble for the dollar, which fell to a three-year low against major currencies Wednesday. It has lost 7.7 percent in 2011. <.DXY>
"The dollar got beat up pretty badly against the euro," said Firas Askari, head of foreign exchange trading at BMO Capital Markets. "The U.S. fiscal situation is a concern. Now it seems the U.S. economy isn't just tepid but actually cooling off again. That's not encouraging."
But Askari and others said concerns about slower U.S. growth also dulled appetite for commodities and higher-yield assets for fear a U.S. slump would reverberate globally.
That sent the safe-haven Swiss franc
EURO SUPPORT
The euro remained fairly well supported in anticipation of higher euro zone interest rates and strong sovereign demand. Investors brushed off news that Portugal had become the third euro zone country in the last year to need a bailout and drove the euro to $1.4939, a 17-month high. It later eased to $1.4860
Traders said a move above $1.50 was likely but would probably have to wait until after Thursday's European Central Bank meeting, which should offer clues on future rate hikes.
The ECB raised rates in April for the first time since 2008 and is expected to do so again this year to tame inflation, even as higher rates make it more difficult for countries such as Portugal to service their debts. [ID:nLDE7422CB]
"The currency market seems to have learnt to live with the struggles of the peripheral euro zone nations." said Audrey Childe-Freeman, currency strategist at JP Morgan Private Bank.
Markets do not expect the Fed to raise rates from near zero until the middle of 2012. <0#FF:>
YEN STRENGTHENS
The dollar fell 0.3 percent to 80.68 yen
Major central banks actively sold the yen earlier this year after it hit a record high against the dollar. A strong yen could hurt Japan's export-led economy as it struggles with slow growth and the aftermath of March's earthquake and tsunami.
"People are watching that 80 level, which isn't very far away," said BNY Mellon strategist Michael Woolfolk.
The Australian dollar
Some gauges of market positioning suggest speculators and hedge funds are heavily short the dollar, leaving open the possibility of more position unwinding.
But the U.S. dollar has been unable to build on short-covering support seen in past days, and investors are likely to look for fresh selling opportunities.
"There are still no big incentives to go short euros," said Roberto Mialich, strategist at Unicredit in Milan. "At the end of the day, the dollar will be sold again, and it's just a matter of time for a test of $1.50." (Additional reporting by Naomi Tajitsu in London; Editing by Andrea Ricci)
48 comments
down. 1 users disliked this commentSocialistDemocratsFU Report Abuse
Obama is purposely driving America into the mud in order to achieve a global level playing field and to punish America for past sins.
Replies (5)- 40 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentGino Report Abuse
the MASS is so stupid...many have no idea how this is connected to the huge price increases in all their day to day products..keep spending govt and it will get worse. China stated today the true usa inflation rate is 11% a year...meaning..in ten years..your value of the dollar down 100%
Replies (6) - 37 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentMelp16 Report Abuse
Obamanomics at its best!!!!!!! Please, please, please do not re-elect the un-American President who has almost destroyed this country!
Replies (2) - 32 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentbogota Report Abuse
my takehome pay wont take me home
Replies (1) - 58 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 3 users disliked this commentJoey Jason Report Abuse
THIS SENIOR CITIZEN NAILED IT!!!!!!!!!!!!!!
Replies (5)
Alan Simpson, Senator from Wyoming , Co-Chair of Obama's deficit
commission, calls senior citizens the Greediest Generation as he
compared "Social Security" to a Milk Cow with 310 million teats.
August, 2010.
Here's a response in a letter from a unknown fellow in Montana ...
I think he is a little ticked off! He also tells it like it is !
"Hey Alan , let's get a few things straight..
1. As a career politician, you have been on the public dole for FIFTY
YEARS..
2. I have been paying Social Security taxes for 48 YEARS (since I was 15
years old. I am now 63).
3 My Social Security payments, and those of millions of other
Americans, were safely tucked away in an interest bearing account for
decades until you political pukes decided to raid the account and give
OUR money to a bunch of zero ambition losers in return for votes, thus
bankrupting the system and turning Social Security into a Ponzi scheme
that would have made Bernie Madoff proud.
4. Recently, just like Lucy & Charlie Brown, you and your ilk pulled the
proverbial football away from millions of American seniors nearing
retirement and moved the goalposts for full retirement from age 65 to
age 67. NOW, you and your shill commission is proposing to move the
goalposts YET AGAIN.
5 I, and millions of other Americans, have been paying into Medicare
from Day One, and now you morons propose to change the rules of the
game. Why? Because you idiots mismanaged other parts of the economy
to such an extent that you need to steal money from Medicare to pay
the bills.
6. I, and millions of other Americans, have been paying income taxes our
entire lives, and now you propose to increase our taxes yet again. Why?
Because you incompetent @#$% spent our money so profligately that
you just kept on spending even after you ran out of money. Now, you come
to the American taxpayers and say you need more to pay off YOUR debt.
To add insult to injury, you label us "greedy" for calling "bullshit" on
your incompetence. Well, Captain Bullshit, I have a few questions for
YOU.
1. How much money have you earned from the American taxpayers during
your pathetic 50-year political career?
2. At what age did you retire from your pathetic political career, and
how much are you receiving in annual retirement benefits from the
American taxpayers?
3. How much do you pay for YOUR government provided health insurance?
4. What cuts in YOUR retirement and healthcare benefits are you
proposing in your disgusting deficit reduction proposal, or, as usual,
have you exempted yourself and your political cronies?
It is you, Captain Bullshit, and your political co-conspirators called
Congress who are the "greedy" ones. It is you and your fellow nutcases
who have bankrupted America and stolen the American dream from
millions of loyal, patriotic taxpayers. And for what? Votes. That's right,
sir. You and yours have bankrupted America for the sole purpose of
advancing your pathetic political careers. You know it, we know it, and
you know that we know it.
And you can take that to the bank, you miserable son of a @#$%.
If you like the way things are in America , delete this. If you agree with
what a fellow Montana citizen says, PASS IT ON!!!! - 26 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentD. A. Report Abuse
Obama has cut the throat of America.
Replies (1) - 26 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentCoolcat Report Abuse
Not much of a suprise. Just print more money. *Sarcasm*
Reply - 28 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentff Report Abuse
the real story is not the story, we are in trouble. killing ubl is history, lets get back to the economy.show the picture. and lets move on .
Reply - 18 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentyearning to be free Report Abuse
The Democrats want us all to be equally poor. They want us all on the bus, living in one room apartments, working were they want us to work, if at all, and as for your kids, they may not get past Planned Parenthood. You see, the endangered species if Democrats have their way is people.
Reply - 34 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 2 users disliked this commentKenny Report Abuse
Thank you Obama (Ivy League educated community organizer), Bernake (Ivy League educated Goldman Sachs) and Geithner Ivy League educated former NY fed head during meltdown and Bernie Maddoff). Wow!
Replies (1) - 15 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentJeffersonian by Nature Report Abuse
Hot Air is what is holding our economy up ... while the left wants to ''spend '' more money , print more money and The Fed Write and Issue more Bonds .While the Dollar "Bomb's " .
Replies (1)
In other words ... how to Commit ""Economic Suicide "" is now a DC practice .
Those Bonds will have to be sold for far more interest on them to find willing buying ... USHERING in
****** FAR MORE INFLATION **** We saw start last Sept that will quadruple those numbers soon . Jimmy Carters 12.7 % inflation are on their way and all the nasty things that made lif efar worse with it sadly ......... Like more loss of Jobs , sky high INTEREST RATES and Housing . - 21 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentHurry Up November 2012! Report Abuse
What other rabbits does the obama administration have in their hats? Seems QE2 has not stoked job recovery. Seems he might be running out of options. What happens when the Chinese have weaned themselves of our purchases? obama is not for America. he simply is not. If he were, oil exploration would be booming in the U.S., the healthcare bill would not have happened, the "stimulus" bill would not have happened, the financia regulation bill would not have happened. This guy knows he only has about 600 days to collapse the economy for good. He is hard at work trying to make that happen by executive fiat and regulatory body rule. Congress is just a distraction to him. Same with Supreme Court. If MSM does not start to go after barry, we are toast.
Reply - 9 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentyearning to be free Report Abuse
The Democrats want us all to be equally poor. They want us all on the bus, living in one room apartments, working were they want us to work, if at all, and as for your kids, they may not get past Planned Parenthood. You see, the endangered species if Democrats have their way is people.
Replies (1) - 8 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentTerrylee Report Abuse
Obama is destroying this country, along with George Soros, Cass Sunstein etc..all his card carrying communist czars..........Impeech Obama for treason.
Reply - 7 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentpaul s Report Abuse
I'm just waiting for Obama to change the fourth of July to the may day parade. History has shown socialism has not worked...Why do these idiots keep trying to make it work?? We keep importing these third world people into our country and they will do exactly what they did in their old country. And that includes hating America.
Replies (1) - 6 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentAC7880 Report Abuse
"I will focus on the economy like a laser beam" said Obama Been Lying.
Reply - 5 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentSlammy Report Abuse
Ron Paul 2012! OR 3rd part! both parties SUCK! And they are ruining this country. Vote Every one OUT! OUT! OUT!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Reply - 4 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentAutoamerican Report Abuse
This is so annoying. Obama and the globalists who pull his strings obviously want to collapse the country. There is no other explanation for what is going on. This has to be deliberate. Nothing makes sense unless you accept that the country has been deliberately placed in this position.
Replies (1) - 4 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentMikey Report Abuse
Us "Preppers" are looking less nutty every day...
Reply - 4 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentHurry Up November 2012! Report Abuse
What's with Yahoo! and this new pop up: "Your rating has been received and will appear momentarily. Thank you for your submission"?????
No comments:
Post a Comment