Employment Data Pushes U.S. Dollar Up

A report published today indicating fewer-than-expected new jobless claims applications last week allowed the dollar to gain versus the euro and several other currencies as improving employment data is a key-evidence indicating the U.S. economic recovery expected for 2010.
A positive sentiment towards the U.S. employment conditions provided support for the greenback to touch the highest level in four months versus the yen as traders expect a payrolls report tomorrow to show a decrease in job losses, after today’s weekly jobless claims report also came with positive figures. The greenback also pared losses versus commodity linked currencies like the Aussie and the Canadian dollar, which posted several days of advance as the crude oil rates rose on expectations demand will rise in 2010, favoring also riskier assets during this week so far.
Analysts consider the employment data as extremely relevant for indicating the U.S. economic health, as even if other data may indicate a recovery, normally bad employment figures evidence problems in a country’s economic outlook. Tomorrow payrolls report will be essential to determine the dollar’s trends in the short term.
EUR/USD declined to 1.4317 as of 18:16 GMT from a previous intraday rate of 1.4397. AUD/USD traded at 0.9177 after trading as high as 0.9253.

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