Dollar at One-Month High Against Yen
October 05 2016 - 11:23AM
Dow Jones News
By Chelsey Dulaney
The dollar rose to a one-month high against the Japanese yen on
Wednesday, after strong U.S. service-sector data.
The dollar was recently up 0.6% at Y103.515, on track for its
seventh consecutive session of gains. The WSJ Dollar Index, which
measures the U.S. currency against 16 others, rose 0.2% to
87.21.
Meanwhile, the euro was down 0.1% to $1.1198, while the British
pound edged up 0.1% to $1.2736 after falling to a fresh 31-year-low
on Tuesday.
The Institute for Supply Management's service-sector index rose
to 57.1% in September from 51.4% in August, a sign of steady growth
for a important segment of the economy. Economists surveyed by The
Wall Street Journal had expected a September reading of 53%.
"Markets are regaining some confidence in the U.S. economy,"
said Vassili Serebriakov, an FX strategist at Crédit Agricole.
The dollar has been particularly strong against the Japanese yen
recently, likely because investors have been forced to unwind big
bets that the dollar will fall against the yen, Mr. Serebriakov
said.
"The caution around the U.S. economy, the disappointing data we
got a month ago was built into positioning on dollar/yen," said Mr.
Serebriakov. "They got caught wrong-footed by some of that U.S.
data."
Separately, a report from Automatic Data Processing on Wednesday
showed private U.S. employers added 154,000 workers in September,
below the 173,000 additions economists had expected.
The data comes ahead of Friday's U.S. nonfarm payrolls report,
viewed by many as the best read on the health of the labor market.
Investors are watching this week's data and commentary from Fed
officials for clues on the path of U.S. interest-rate
increases.
The Fed held rates steady at its meeting in September but said
the case for raising rates this year has strengthened.
Fed-funds futures, which are used to bet on central-bank policy,
showed investors assigned a 65% likelihood to a rate increase in
December, edging up from 63% the previous day, according to CME
data.
Higher rates tend to boost the dollar by making it more
attractive to investors seeking yield.
Still, the U.S. currency was lower against many emerging-market
currencies, which often are pressured by expectations for higher
U.S. rates. The dollar fell 0.3% against the South African rand and
0.5% against the Brazilian real.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
(END) Dow Jones Newswires
October 05, 2016 11:08 ET (15:08 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Credit Agricole (PK) (USOTC:CRARY)
Historical Stock Chart
From Jul 2024 to Jul 2024
Credit Agricole (PK) (USOTC:CRARY)
Historical Stock Chart
From Jul 2023 to Jul 2024