The US dollar ended the week with gains against other most-traded currencies even as economic data released from the United States over the week was disappointing. The greenback even gained against the Canadian dollar which should have been supported by Canada’s amazing jobs data.
The employment report from Automatic Data Processing released on Wednesday missed expectations, leading to concerns that Friday’s non-farm payrolls would be below expectations too. Yet Thursday’s jobless claims improved the sentiment of dollar bulls, showing an unexpected drop of claims for unemployment benefits. As it turned out, pessimists were right as non-farm payrolls indeed missed forecasts, hushing speculations about possibility of an interest rate hike before December. While that made the dollar to trim its weekly gains, it did not erase them completely, and prospects for a December hike continue to support the currency.
Meanwhile, Canada’s employment report showed huge growth by 67,200 in August, far bigger than analysts’ forecasts of 8,500. Yet the data did not provide support for the currency, perhaps due to the drop of crude oil prices.
EUR/USD was down from 1.1226 to 1.1104 during the week but rebounded to 1.1199 by the weekend. GBP/USD sank 3.8% from 1.2919 to 1.2429, logging flash crash to a new 31-year low of 1.1825 without a clear reason. USD/CAD rallied from 1.3110 to 1.3289.
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