US Dollar Suffers From Terrible Nonfarm Payrolls

US DollarThe US dollar fell against other major currencies, including the Great Britain pound and the Japanese yen, today after the non-farm payrolls showed that job creation in the US stalled. The currency also slipped against the euro, but later rebounded.

US non-farm payrolls showed no employment growth in August. That’s much worse than the market expectations (growth by 74,000) and the worst reading since September 2010, when employment declined by 95,000. Average hourly earnings dropped 0.1 percent, while markets counted on an increase by 0.2 percent. The poor economic report renewed speculations that the Federal Reserve needs third round of asset purchases, known as quantitative easing, to bolster the economic recovery in the United States.

The Dollar Index managed to rise 0.3 percent to 74.683 today from 74.479 yesterday. The dollar trimmed losses versus the pound and the yen, as well as rebounded versus the euro. The Standard & Poor’s 500 Index plunged as much as 2.3 percent.

GBP/USD climbed from 1.6177 to 1.6253 before trading at 1.6220 as of 19:40 GMT today. USD/JPY fell from 76.91 to 76.80 and touched low of 76.52 intraday. Meanwhile, EUR/USD tumbled from 1.4257 to 1.4199.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Earlier News About the US Dollar:

    * US Manufacturing Expands, Dollar Profits (2011-09-01)
    * USD Gains vs. EUR & CHF, Falls vs. JPY (2011-08-30)
    * Fundamentals are Bad for US Dollar, But Week Wasn't Bad (2011-08-27)
    * Dollar Drops After Bernanke Speech & GDP Report (2011-08-26)
    * Will Bernanke Announce QE3? Will Dollar Decline? (2011-08-25)

Franc Jumps as US Payrolls Show Zero Growth

Swiss francThe Swiss franc climbed today against the US dollar, extending its rally for the third day, after the non-farm payrolls showed that US employers weren’t adding jobs last month.

US non-farm payroll employment showed no change in August, while the unemployment rate remained at 9.1 percent. Analysts predicted an increase of payrolls by 74,000. July value was revised down from 117,000 to 85,000. It’ll be interesting to see how the Federal Reserve will react to such disastrous economic data and what steps it’ll take.

USD/CHF plunged from 037954 to 0.7811 as of 13:45 GMT today. Earlier, the currency pair reached 0.7711, the lowest level since August 12.

If you have any questions, comments or opinions regarding the Swiss Franc, feel free to post them using the commentary form below.

Earlier News About the Swiss Franc:

    * Franc Rallies as SNB Doesn't Intervene (2011-09-01)
    * Franc Falls as Bernanke Improves Sentiment on Markets (2011-08-26)
    * Franc Gains as Markets Return to Risk Aversion (2011-08-24)
    * Franc Falls for Second Day on Risk Sentiment (2011-08-24)
    * Franc's Rally Fails on Euro-Peg Speculation (2011-08-23)

Rand Advances with Stocks & Metals

South African randThe South African rand rallied today, rising to the highest level in more than a week against the US dollar, as stocks and metals advanced after the speech of Federal Reserve Chairman Ben S. Bernanke last week.

Bernanke said last Friday that the Fed has means to support growth of the US economy, improving market sentiment. The main South African stock index jumped 1.7 percent as prices on the London Metal Exchange increased for a fourth day. South Africa’s economy itself performs not that good, though, and many investors still convinced that the nation’s central bank will cut interest rates.

USD/ZAR fell from 7.1300 to 7.0810 today as of 9:56 GMT and touched 7.0680 — the lowest level since August 17.

If you have any questions, comments or opinions regarding the South African Rand, feel free to post them using the commentary form below.

Earlier News About the South African Rand:

    * Rand Weakens on Prospect of Interest Rates Cut (2011-08-22)
    * Rand Near Monthly High vs. USD on Rate Difference, US Uncertainty (2011-07-26)
    * Rand Weakened by Credit Rating Outlook for Greece (2011-07-05)
    * Rand Weakens with Commodities on US Growth Forecast (2011-06-23)
    * South African Rand Falls on Greek Crisis, Trims Losses (2011-06-20)

Fundamentals are Bad for US Dollar, But Week Wasn’t Bad

US DollarThe fundamentals this week were negative for the US dollar, weakening the currency against some major counterparts, but performance of the greenback wasn’t that bad, considering all the pressure to the downside.

There were plenty of bad new for the dollar this week. Bad housing data, rising unemployment claims and slower that expected growth of the US economy. The week ended with the speech of Ben Bernanke, who hinted at possibility of additional stimulus without detailing an actual plan.

The dollar was dragged down by the unfavorable fundamentals and fell against the euro and commodity currencies (including the currencies of Canada, Australia and New Zealand). On the other hand, the dollar gained against the franc and rallied versus the yen before losing its gains by the end of the week as there aren’t many choices for investors who need a safe currency, but afraid of interventions of Japan and Switzerland. The pound also fell against the greenback as Britain has its own problems that erase attractiveness of the nation’s currency.

Next week may also be hard for the dollar. Analysts predict another unfavorable report about hosing and are pessimistic about employment data.

EUR/USD climbed from 1.4376 to 1.4498, while during the week it dropped to 1.4327. USD/CHF climbed from 0.7904 to 0.8058 and reached the daily high of 0.8157. AUD/USD surged from 1.0380 to 1.0569.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Earlier News About the US Dollar:

    * Dollar Drops After Bernanke Speech & GDP Report (2011-08-26)
    * Will Bernanke Announce QE3? Will Dollar Decline? (2011-08-25)
    * Dollar Gains Before Bernanke Speech (2011-08-24)
    * Dollar Falls on China's & Europe's Manufacturing (2011-08-23)
    * Dollar Rises While Traders Afraid of Recession (2011-08-18)

Pound Goes Down as UK Economy Slows

Great Britain poundThe Great Britain pound weakened against the Japanese yen and slowed its advance versus the US dollar after the report showed the UK economy grew with slower pace in the second quarter.

The revised figure for growth of UK gross domestic product in the second quarter of 2011 was 0.2 percent, the same as in the preliminary estimate. It indicates slower expansion, compared to 0.5 percent growth in the first quarter. The report also mentioned that several special events affected Britain’s economy in Q2: the additional April public holiday, the royal wedding and the aftereffects of the Japanese tsunami.

GBP/JPY fell from 126.12 to 125.68 today as of 9:24 GMT and touched the daily low of 125.41 earlier. GBP/USD climbed from 1.6278 to 1.6332.

If you have any questions, comments or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

Earlier News About the Great Britain Pound:

* GBP Falls vs. EUR with Consumer Confidence & Retail Sales (2011-08-25)
* Pound Rises as Inflation Accelerates (2011-08-16)
* Osborne Refuses Review Spending Cuts, Boosting Pound (2011-08-12)
* Pound Drops with Higher Trade Deficit (2011-08-09)
* Pound Weakens on Worsening Consumer Sentiment (2011-07-21)

Euro Falls for Second Day vs. Dollar

EuroThe euro fell against the US dollar for the second day and erased gains versus the Swiss franc today as investors are less willing to buy the currency amid signs of problems in Europe and concerns of global economic slowdown.


The decline of consumer confidence in Germany had its negative impact on the shared European currency. GfK stated that German consumer confidence fell from 5.3 to 5.2 this month and wrote in the report:


Economic expectations virtually collapsed in August, and in light of this, there has also been a moderate drop in Germans’ income expectations.


The euro also weakened on the speculation European lawmakers will extend the ban on short sales.


The global weren’t very supportive for the euro either as rising unemployment claims worsened sentiment of traders. Jobless claims in the US rose to 417,000 last week from the previous week’s revised figure of 412,000. Economists anticipated decrease to 403,000.


EUR/USD fell from 1.4412 to 1.4377 today as of 17:39 GMT. During the day the currency pair reached the high of 1.4474 and the low of 1.4327. EUR/CHF traded at 1.4437 today after earlier it dropped from 1.1465 to 1.1407.


If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.


Earlier News About the Euro:


* Euro Drops as Europe's Economic Growth Slows (2011-08-16)

* Euro Weakens as Investors Shun European Bonds (2011-08-02)

* Euro Slids for Second Day on Debt Crisis Concern (2011-07-28)

* Euro Posts Weekly Gain After Two Weeks of Losses (2011-07-23)

* Euro Drops as Optimism Caused by EU Summit Wanes (2011-07-22)

Australia’s Dollar Weakens on Germany’s Consumer Confidence

Australian dollarThe Australian dollar fell today against most major currencies, before rebounding, as the report showed consumer confidence in Germany declined this month, reducing appeal of higher-yielding assets.

The drop of German confidence wasn’t very big as the GfK indicator retreated just to 5.2 in August from 5.3 in the month before. The report explained:

    Despite the current crisis on the financial markets, Germans’ willingness to buy is surprisingly robust and increased further in August from an already high level. However, the worsening of the international debt crisis and rising fears of a return to recession for the global economy have clearly left their mark on the economic optimism of Germans.

AUD/USD traded at about 1.0466 today as of 11:16 GMT after dropping from 1.0471 to 1.0428.

If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.

Earlier News About the Australian Dollar:

    * Australia Dollar Receives Help from Commodities (2011-08-17)
    * Aussie Falls as RBA Minutes Don't Exclude Rates Cut (2011-08-16)
    * Australia's Dollar Rallies Despite Rising Unemployment (2011-08-11)
    * Consumer Sentiment Curbs Appeal of Aussie (2011-08-10)
    * Australian Dollar Attempts Stop Decline, Fails (2011-08-09)