Euro Rebounds After Mildly Encouraging US Jobs Report
(RTTNews) The euro rallied on increased risk appetite Friday, after an encouraging US jobs report raised hopes the world`s largest economy is on a sustainable path toward recovery.
Talk of a double-dip recession in Europe and the US has recently made the safe haven yen the most attractive currency option.
However, a reversal of sentiment could mean a rapid strengthening of the euro, which slipped to multi-year lows against the dollar and yen this summer.
The euro edged to a fresh 2-week high of $1.2870 versus the dollar, but failed to sustain its initial gains after the jobs report. Approaching the opening bell on Wall Street, the euro was back to 1.2840, near its overnight levels.
The big move to the upside was seen against the yen. The euro surged to Y109.50, away from a recent 9-year low of Y105.41.
The euro wobbled versus the sterling, bouncing back and forth near 0.8320.
The closely-watched report from the Labor Department said that US non-farm payroll employment fell by 54,000 jobs in August, matching the revised decrease in jobs seen in July. Economists had expected employment to fall by about 120,000 jobs compared to the loss of 131,000 jobs originally reported for the previous month.
Surprisingly, private sector employment increased for the eight consecutive month, rising by 67,000 jobs.
In economic news from across the Atlantic, Eurozone retail sales volume increased in July for the third straight month, largely led by sales of food.
July`s modest 0.1 percent increase in Eurozone retail sales raises hopes that Eurozone`s export-led recovery is gradually becoming more broad-based, commented Martin van Vliet, an economist at ING Bank NV.
Eurozone private sector continued its expansion with services activity picking up to a three-month high in August. France and Germany led the strong performance, while some others struggled to sustain recovery. |
