Forex - Dollar firmer in Sydney morning, range trading ahead of US payroll data |
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Fri, 02 Feb 2007 00:52
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SYDNEY (XFN-ASIA) - The US dollar was higher against the yen and euro here although traders are maintaining a cautious stance ahead of tonight's US non-farm payrolls data for January, dealers said.They said expectations of a solid employment rise in the US last month are checking any further potential selling in the US dollar despite Wednesday's Federal Reserve outlook statement, which reduced expectations for interest rate hikes ahead, as well as a weaker ISM manufacturing survey for January released overnight.At 10.08 am Sydney time (2308 GMT Thursday), the dollar was at 120.80 yen from 120.67 in late New York trading while the euro was at 1.3018 usd, down slightly from 1.3023 in New York.Dealers said the euro traded between 1.3000-1.3040 usd overnight while the US dollar drifted between 120.10-120.80 yen.CMC Markets' chief analyst Ashraf Laidi said dollar selling is also being minimized by declining oil prices, which aids the US currency via a reduced trade deficit and higher consumer discretionary income.However, he said the US dollar could fall to around 119.20 yen if tonight's payrolls outcome is weak, combined with further media reports on officials calling for a higher yen ahead of next week's G7 finance ministers meeting.Market expectations for January non-farm payrolls is a rise of 145,000 from the 167,000 increase in December as initial jobless claims have declined below 300,000 during last month.On the euro, CMC's Laidi said support for the single currency stands at 1.2980 usd and resistance around 1.3050 usd, then 1.3080.The US ISM manufacturing survey for January, released overnight, fell to 49.3 index points from 51.4 in December, the lowest reading in almost four years and indicative of contraction in the sector.Commonwealth Bank senior economist John Peters said the fall in the overall index was in large part due to a drop in the inventories component to 39.9 index points from 48.5 in December, but this is a positive sign as firms have cut production in order to run down inventories while demand is still strong.Meanwhile, US personal spending data for December rose 0.7 pct and incomes increased 0.5 pct but this data had little effect following Wednesday's solid release of a 3.5 pct rise in gross domestic product over the year to the December quarter.Dealers said more important for inflation was the overnight release of the Fed's closely watched measure of underlying inflation, the core Private Consumer Expenditure (PCE), which rose just 0.1 pct, while the annual growth remains elevated at 2.3 pct -- outside the Fed's 1.0-2.0 pct target band.Sydney 10:08 am (2308 GMT Thursday)US dollar120.80 yen1.2437 sfrEuro1.3018 usd157.31 yen1.6194 sfr0.6620 stgSterling1.9672 usd237.74 yen2.4464 sfrAustralian dollar0.7739 usd0.3934 stg93.470 yenNew Zealand dollar0.6825 usdpaul.daniel@xfn.com
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Forex - US dollar mixed in Sydney afternoon; range trading seen on lack of cues 