Forex – Dollar steady but lower on conflicting data, looks to jobs repor

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Investing.com – The dollar traded steady to lower against most major currencies on Friday after improving consumer sentiment data hit the wire one day after weekly jobless claims disappointed, clouding expectations as to when the Federal Reserve will wind down stimulus programs.

Monetary stimulus programs such as the Fed’s monthly USD85 billion bond-buying program keep the dollar weak by pushing down borrowing costs.

In U.S. trading on Friday, EUR/USD was unchanged at 1.3278.

On Thursday, the Labor Department said that the number of individuals filing for initial jobless benefits last week increased by 7,000 to 343,000 surpassing expectations for a gain of 4,000 to 340,000.

One day later on Friday, the Thomson Reuters/University of Michigan consumer sentiment rose more than expected in July, hitting 85.1 from 83.9 in June.

Analysts had expected the index to rise to 84.0 this month.

The report also said that inflation expectations fell to 3.1% this month, from 3.3% in June.

Investors largely avoided the dollar and braced for next week, when the Bureau of Labor Statistics will unveil the July jobs report, which investors hope will serve as a weather vane for U.S. monetary policy.

The greenback, meanwhile, was up against the pound, with GBP/USD trading down 0.05% at 1.5382.

The dollar was down against the yen, with USD/JPY down 1.02% at 98.28, and down against the Swiss franc, with USD/CHF trading down 0.16% at 0.9286.

In Japan, official data showed that the country’s consumer price index rose 0.4% on year in June, beating expectations for a 0.3% gain, which strengthened the yen.

On a monthly basis, Japan’s June inflation rate rose 0.2% from May, beating expectations for a 0.1% gain.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.01% at 1.0280, AUD/USD up 0.23% at 0.9266 and NZD/USD trading up 0.07% at 0.8087.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.06% at 81.77.



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