Dollar Weakens Ahead of Jobs Data; Aussie & Euro Strengthen
The US dollar struggled to strengthen midweek as market participants adopted a wait-and-see approach ahead of major US data releases, particularly the January Nonfarm Payrolls (NFP) on Wednesday (February 11th), along with the unemployment rate and wage inflation. Pressure on the greenback intensified after the latest US consumption data weakened, adding to speculation that interest rates could be eased.
The dollar index (DXY) hovered around 96.6 and remained under pressure (around -0.20% daily on the latest data), reflecting weakening demand for the dollar ahead of the risky NFP event. Flat US Retail Sales data (0.0%) also weighed on the dollar, reinforcing the narrative of slowing consumption.
In the yen market, USD/JPY continued its decline. The pair was last seen around 153.25, down 0.74%, at 07:33 GMT (14:33 WIB), confirming the yen's strength as the dollar weakened and markets reconsidered US interest rate expectations.
Other major currency movements also reflected the same theme: EUR/USD held around 1.1914 (around +0.16% at the last update) as the euro benefited from a weak dollar, while the market awaited signals from US jobs data to determine its next direction.
In the sterling bloc, GBP/USD hovered around 1.3672 (around +0.21% at the last update). The market believes sterling remains sensitive to a combination of UK domestic factors and the global dollar's direction, which is now entirely determined by US data.
Meanwhile, AUD/USD hovered around 0.7073 (around -0.27% at the last update), having previously been boosted by sentiment regarding Australia's relatively tight interest rates. Looking ahead, the NFP release will be the main trigger: a weaker figure could extend the dollar's weakness, while a strong data surprise could trigger a dollar rebound and put pressure on major currencies quickly.
Source: Newsmaker.id
