Dollar eases after mixed US jobs report
The dollar slipped against the euro on Thursday after a mixed US jobs report.
NEW YORK (AFP) - The dollar slipped against the euro on Thursday after a mixed US jobs report and as investors awaited the outcome of a Greek debt crisis referendum.
Ahead of the three-day weekend, with US markets closing Friday in observance of the July 4 Independence Day holiday, there was a bit of a caution overhanging the market, analysts said.
The US Labor Department reported the economy added a solid 223,000 jobs in June and the unemployment rate fell to 5.3 percent from 5.5 percent, but wages remained flat, underscoring persistent weakness amid moderate economic growth.
The US jobs report fueled debate on the Federal Reserve s plan to raise near-zero interest rates this year, with speculation focused on as early as September.
"What counts is the trend in unemployment, which continues to fall rapidly," said Ian Shepherdson of Pantheon Macroeconomics.
Shepherdson noted the 5.3 percent jobless rate is within the Federal Reserve s forecast for the end of this year, and he predicted that the job reports for the coming months will be stronger than in June.
"Policymakers are now set up nicely to tighten soon on the basis that the labor market is normalizing faster than they expected," he said.
Meanwhile, traders looked ahead to Sunday s Greek referendum on official creditor proposals that could decide the nearly insolvent European Union country s political and financial future.
"The referendum may be a yes/no vote on the bailout package but it is also an indirect in/out vote on the euro," said Kathy Lien of BK Asset Management.
"Few Greeks truly understand the economic and social consequences of this vote and how more trouble will follow regardless of the outcome.... Either way, the one absolute certainty is volatility" in the foreign exchange market, she said.
