The euro was in good shape on Thursday, as it was close to a one-month high versus the dollar and a six-week peak to the British pound. Hawkish comments from European Central Bank’s policymakers helped to boost the euro.
The U.S. dollar is struggling to cope with challenges over the past couple of weeks as doubts have crept in about when the Fed will start unwinding its stimulus. Last week, Fed Chair Jerome Powell said the jobs recovery would determine the timing of asset purchase tapering.
The dollar index dropped around 1.4% since hitting a nine-month high on August 20. A combination of factors affected the index including dovish comments from Jerome Powell and other Fed officials.
The dollar index suffered minimal losses and fell to 92.452 by 08:00 GMT. It was not far from a four-week low of 92.376. The index dropped to 92.376 in the previous session due to soft ADP payrolls figures and ASM surveys.
In August, private payrolls rose by 374,000. One month earlier, private sector jobs increased by 326,000, according to ADP’s revised monthly print. The Labor Department data differs from the data released by ADP. It reported that 703,000 private payrolls came back in July.
But ADP counts active employees on company payrolls. In the case of the Labor Department, it counts those paid during the survey period towards the headline jobs figures.
Private employees added more than 200,000 jobs in the leisure and hospitality sector in August, according to ADP. When it comes to the goods-producing sector, overall payrolls rose by 45,000, led by construction industries with job gains of 30,000.
Euro and main findings
The situation was absolutely different in the case of the single currency. It witnessed supportive data flow, including manufacturing growth and inflationary pressure from supply-chain snarls.
The euro traded just off one-month highs of $1.1857, buoyed by data showing inflation rose 3% year on year in August.
German bond yields jumped to their highest levels since late July, thanks to comments from central from a slew of ECB hawks.
The euro also reached good results against other currencies, hitting 130.44 yen on Wednesday, its best result in a month. Nevertheless, the euro struggled to make headway above $1.18.
The New Zealand dollar rose to a one-month high of $0.7084, as rate hike bets pushed yields to two-month peaks.