FOREX-Dollar looks for next catalyst as economic data keep bulls in control

Published 05/04/2021, 06:34
Updated 05/04/2021, 06:36
© Reuters.
DX
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* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
* U.S. nonfarm payrolls supports dollar bulls
* Market activity low due to Easter holidays
* Next focus shifts to U.S. ISM services data

By Stanley White
TOKYO, April 5 (Reuters) - The dollar was largely steady on
Monday as investors soaked up last week's strong U.S. employment
report and looked ahead to data on the U.S. services sector for
affirmation of a solid economic rebound from the coronavirus
shock.
The greenback posted its best quarter against major
currencies in almost three years in January-March thanks to an
improving U.S. economy and rising Treasury yields.
The U.S. currency is likely to build on those gains as
investors look for ways to bet on a global economic recovery
from the worst of the coronavirus pandemic, analysts said.
"I thought there would be a correction lower in the dollar,
but that didn't happen," said Masafumi Yamamoto, chief currency
strategist at Mizuho Securities.
"The dollar's upward trend is very strong. In the new
quarter perhaps the best thing for investors to do is to just
follow this trend."
The dollar was last quoted at 110.62 yen JPY=D3 , not far
from its strongest level in a year.
Against the euro EUR=D3 , the dollar traded at $1.1760,
which is close to a five-month high.
The British pound GBP=D3 held steady at $1.3826.
The dollar rose to 0.9430 Swiss franc CHF=EBS .
The U.S. economy created more jobs than expected in March,
data showed on Friday. However, there was scant reaction in
currencies as most major stock and bond markets were closed for
Easter holidays. Overall, the outlook for the dollar remains solid as the
underlying economic pulse pointed to a strengthening recovery. A
survey from the Institute for Supply Management due later on
Monday is expected to show U.S. non-manufacturing activity
expanded at a faster rate in March.
Trading was subdued on Monday in Asia as financial markets
in Australia, New Zealand, China, and Hong Kong are also closed,
although the bias is for the dollar to strengthen further,
analysts said.
The dollar index =USD against a basket of six major
currencies was little changed at 93.015,
Dollar short positions in the currency market fell last week
to the lowest since June last year, U.S. Commodity Futures
Trading Commision data showed - another positive sign for the
greenback. Elsewhere, the Australian dollar AUD=D3 edged up to
$0.7613, while the New Zealand dollar NZD=D3 bought $0.7027.
========================================================
Currency bid prices at 0521 GMT
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR=EBS $1.1760 $1.1752 +0.07% -3.75% +1.1772 +1.1752
Dollar/Yen JPY=D3 110.6200 110.6700 -0.06% +7.08% +110.7400 +110.5600
Euro/Yen EURJPY= 130.08 130.13 -0.04% +2.49% +130.2500 +130.0900
Dollar/Swiss CHF=EBS 0.9430 0.9408 +0.26% +6.61% +0.9431 +0.9418
Sterling/Dollar GBP=D3 1.3826 1.3825 +0.01% +1.21% +1.3842 +1.3790
Dollar/Canadian CAD=D3 1.2581 1.2585 -0.02% -1.19% +1.2586 +1.2562
Aussie/Dollar AUD=D3 0.7613 0.7591 +0.30% -1.03% +0.7625 +0.7607
NZ NZD=D3 0.7027 0.7017 +0.12% -2.17% +0.7036 +0.7023
Dollar/Dollar


All spots FX=
Tokyo spots AFX=
Europe spots EFX=
Volatilities FXVOL=
Tokyo Forex market info from BOJ TKYFX

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World FX rates https://tmsnrt.rs/2RBWI5E
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