Dollar Weakens Ahead of Payrolls, Yen Strengthens Sharply
The US dollar weakened against all major G10 currencies ahead of the release of the US employment report. Pressure on the greenback emerged after the market weighed in on comments from Federal Reserve Chairman Kevin Warsh, who stated that inflation risks had eased in recent weeks.
The Bloomberg Dollar Spot Index fell 0.3% and was on track for its biggest daily decline since June 11. Warsh maintained the Fed's commitment to maintaining price stability, but his remarks eased some market concerns about the central bank's aggressive actions.
Investors' focus is now on US payrolls data. Economists surveyed expect US companies to add 113,000 jobs in June, down from 172,000 jobs in the previous month. This data will provide important clues regarding the direction of the Fed's interest rate policy.
The Japanese yen strengthened sharply amid the growing risk of intervention and position unwinding ahead of the long holiday in the United States. USD/JPY fell 1% to 160.91 after rising to 162.84 on Wednesday, its highest level since December 1986.
In other currencies, EUR/USD rose 0.4% to 1.1421. Meanwhile, EUR/GBP fell for the fourth straight day to 0.8546, a new one-year low. EUR/CHF also weakened 0.3% to 0.9181, its lowest level since June 17.
Source: Newsmaker
