Thursday, 6 Aug 2009

U.S Dollar is Lifted by Risk Aversion

The U.S dollar rose versus the EUR on Thursday on a renewed bout of risk aversion ahead of a key government report on the U.S. labor markets tomorrow. The USD also rose versus the Japanese yen as a government report showing a sharp drop in U.S. jobless claims boosted views that the labor market and the economy were stabilizing. In morning trading in New York, the Dollar was up 0.8% at 95.70 yen.

Looking further ahead, investors are awaiting the U.S. government's monthly report on Non-Farm Payrolls for July, due out Friday. Economists expect a loss of 275,000 jobs, which would be the fewest jobs lost since August. To reignite the rally in USD, investors will want to see that the U.S. labor market is following the manufacturing and housing sectors, which have both flashed some encouraging signals that the worst of the recession may be over