[B]Market Review[/B] - 06/09/2013 [I]18:16GMT[/I]
[B]Dollar weakens broadly after weaker-than-expected U.S. non-farm payrolls[/B]
The U.S. dollar tumbled against other major currencies on Friday after U.S. job growth came in less than market forecast, adding to uncertainty over the Federal Reserve’s next policy move at its next policy meeting on September 17-18, weighing on demand for the greenback.
The U.S. economy added 169,000 jobs in August, less than the median forecast of 180,000 increase, whilst previous month’s figure was downwardly revised to 104,000 from 162,000. U.S. unemployment rate dropped slightly to 7.3% in August, from 7.4% in July, as more people left the work force.
Versus the Japanese yen, despite an initial rise to a fresh 6-week high of 100.24 in Friday’s Australian morning following gain in previous session, profit-taking pressured price from there and dollar tanked to 99.70 in Asia n then to 99.50 in European morning. Later, the release of disappointing U.S. jobs data knocked the pair sharply lower in New York morning to as low as 98.52 before recovering.
The single currency remained under pressure in Asia and then dropped marginally below Thursday’s low at 1.3110 to a fresh 6-week low at 1.3105 in European trading after data showed German industrial production fell more than expected in July and adding to signs that growth in Europe’s biggest economy is moderating. However, dollar’s board-based weakness after U.S. jobs data pushed price sharply higher in New York morning n euro jumped to 1.3180 and then 1.3189 before easing.
Industrial output in Germany contracted by 1.7 percent in July after expanding by 2.0 percent in June. German Economy Ministry says ‘July’s fall is due mainly to strong previous month; moderate upwards trend in manufacturing, significant stronger trend in construction to continue.’
The British pound retreated versus the dollar after meeting renewed selling interest at 1.5614 in Friday’s Asian session and then dropped in tandem with euro to 1.5564 in European morning. However, dollar’s broad-based weakness in New York morning together with cross-buying of sterling vs euro sent cable sharply higher to a fresh 2-week high of 1.5681 before retreating on weekend profit-taking.
In other news, G20 said on Friday ‘challenges to global economy are unemployment, weak growth, financial market fragmentation in Europe; slower growth in emerging market economies caused in some cases by volatile capital flows; urgent need is to increase the momentum of the global recovery; work on putting world economy on path to recovery is not yet complete; remains mindful of risks, unintended negative side effects of extended periods of monetary easing; central banks commit that future changes to monetary policy are ‘carefully calibrated and clearly communicated’; advanced economies commit to credible and ambitious medium-term fiscal strategies; work on global economic recovery not complete’
[B][B]Data to be released next week : [/B][/B]
[B]Monday : [/B]Australia home loans, Japan GDP, business capital expenditure, current account, consumer confidence, economic watch DI, China PPI, CPI, Swiss retail sales, unemployment rate, EU sentix investor confidence, Canada building permit.
[B]Tuesday :[/B]Australia business condition, Japan all industry index, China industrial production, fixed assets investment urban, retail sales, France industrial production, manufacturing production, Italy GDP, U.K. RICS house price, Canada housing starts, U.S. retail sales.
[B]Wednesday :[/B]Australia consumer confidence, Japan Domestic CGPI, Germany CPI, HICP, U.K. claimant count, unemployment rate, average earning, U.S. wholesales inventories, wholesale sales.
[B]Thursday :[/B]New Zealand rate decision, Australia employment change, unemployment rate, Japan machinery orders, France HICP, CPI, Italy industrial production, CPI, HICP, EU industrial production Canada new housing price index, U.S. jobless claims, import price index, export price index, Fed budget.
[B]Friday :[/B]New Zealand PMI, consumer confidence, Japan industrial production, capacity utilization, EU trade balance, U.S. PPI, retail sales, business inventories, University of Michigan consumer confidence.