Currency markets still focused on worse than expected payroll data
June 5th - Currency markets have been left to focus on Friday’s significantly worse than expected non-farm payroll data and with little else around the dollar has found few reasons to move far off its recent lows. There’s a steady stream of economic data due as the day progresses, but many will likely be left to focus on the ISM non-manufacturing survey to see if there’s any support emerging here for the greenback. However, last week’s corresponding ISM manufacturing reading held little cheer, so another disappointing number here stands to provide little relief for the dollar in the short term. Once again though we’ve got that situation where the fundamentals may look less than inspiring but a technical correction as traders aim to book some profits might deliver at least a degree of upside. Perhaps of critical importance as the week progresses will be the ECB rate verdict - the Bank won’t meet in July so many see this congress as a sure time for a rate hike, possibly even as much as .5%, although with a downbeat GDP forecast coming out of Germany over the weekend – government economic advisers putting growth at just 1.5% for 2006, below the 1.8% estimated elsewhere – a rate freeze remains a possibility and without doubt, any such news would be sufficient to initiate a run of selling against the common currency…
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