Dollar Wobble as Traders await US Payrolls
Yesterday saw the dollar hold a slightly firmer position on the exchanges, this was likely caused by the general ‘risk-off’ mood on the markets. EUR/USD continued to fall, hitting a fresh YTD low hitting the midpoint of the $1.15-1.16 range. Overnight however, we saw the dollar hand back most of its gains – as traders’ risk appetite seemingly improved. Data wise, Eurozone retail sales came in lower than predicted, rising by only 0.3% in August and the US ADP employment report beat expectations, which again explains the EUR/USD lows.
As we continue today, EUR/USD started just above the midpoint of $1.15-1.16. EUR/GBP remains at the 85p threshold and GBP/USD is trading at the $1.36 mark. In terms of data, already this morning we have seen German industrial production released – it shows that output fell by 4.0% in August which is considerably worse than the -0.4% forecast. However, this has not had any major impact on the euro during early trading.
Later today, the ECB Governing Council meeting minutes for September are due, but otherwise there is a quiet data schedule. The risk-off tone from traders we have seen so far this week indicates that they are keyed up for US payrolls on Friday.