Dollar Extending Gains After Friday's Jobs Report
Washington (Aug 8) The dollar is up against the Japanese Yen and the British pound Monday afternoon, but is nearly flat against the Euro. Friday's stronger than expected July jobs data has boosted confidence about the strength of the US economy, lending support to the case for a Fed rate hike this year.
The Labor Department released a report last Friday showing much stronger than expected US monthly job growth. The report released by the Labor Department on Friday showed that non-farm payroll employment surged up by 255,000 jobs in July after jumping by an upwardly revised 292,000 jobs in June. Employment had been expected to increase by about 185,000 jobs compared to the addition of 287,000 jobs originally reported for the previous month.
A lack of US economic data is keeping some investors on the sidelines. Data will remain on the light side until the end of the week, with only productivity and costs to look forward to tomorrow. Weekly jobless claims data is due on Thursday, followed by the retail sales and producer prices reports for July and preliminary results of the University of Michigan's consumer sentiment report for August, all due on Friday.
The French economy is set to grow at a slightly faster pace in the third quarter, the Bank of France said in a monthly report on Monday. Gross domestic product is expected to expand 0.3% in third quarter. The economic growth had remained flat in the second quarter.
The dollar has rebounded to around USD1.1080 Monday afternoon, from an early low of USD1.1104 .
Eurozone investor confidence improved in August as the outcome of the "Brexit" referendum had little impact on economic expectations, results of the latest Sentix survey showed Monday. The investor sentiment index rose more-than-expected to 4.2 in August from 1.7 in July. It was forecast to increase to 3.6.
Germany's industrial production recovered in June, but the decline in output over the second quarter signals the least contribution to economic growth, leaving private spending as a source for expansion.
Industrial production climbed 0.8% from May, when it fell by a revised 0.9%, data from Destatis showed Monday. This was the fastest growth in five months. Economists had forecast a 0.9% rise for June.
The buck has risen to around USD1.3040 against the pound sterling this afternoon, from a low of USD1.3096 this morning.
The greenback has broken out to a 4-session high of Y102.475 against the Japanese Yen this afternoon from a low of around Y101 Friday morning.
Japan posted a current account surplus of 974.4 billion yen in July, the Ministry of Finance said on Monday - up 80.1% on year. The headline figure was beneath expectations for 1,103.5 billion yen and down from 1,809.1 billion in May.
Overall bank lending in Japan was up 2.1% on year in July, the Bank of Japan said on Monday - standing at 499.590 trillion yen . That was above forecasts for 2.0%, which would have been unchanged from the June reading.
A measure of peoples' assessment of the Japanese economy increased more-than-expected in July, after falling sharply in the previous month, survey figures from the Cabinet Office showed Monday. The current index of Economy Watchers' survey rose to 47.1 in July from 41.5 in June. Economists had expected the index to climb to 42.5.
Source: AllianceNews
