The dollar climbed against its major rivals after a stronger-than-expected manufacturing report, temporarily easing worries about US economy slow-down and the Fed interest rate outlook. The manufacturing ISM rose from 50.9 to a 11-month high at 54.7 in April. The greenback bounced from near-record low at 1.3672 to test the 1.36 handle against the euro. The sterling went off a high at 2.0073 to the 2 level versus the dollar.
The dollar rebound today was partly a result of the thin trading during the Labor Day and the lack of fresh data. This single manufacturing report was not enough to change the overall negative sentiment over the greenback. The market will focus on the employment report from the US Labor Department this Friday for more clues on the economic conditions and outlook. Besides, tomorrow¡¯s ADP job report will give some insights on the job market of private sectors.
EURUSD will face interim resistance at 1.3650, followed by 1.3670 and 1.37. Additional ceilings will emerge at 1.3730, backed by 1.3750. Support starts at 1.36, backed by 1.3580, 1.3550 and 1.3530. Subsequent floors are eyed at 1.35.
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