The dollar stood tall on Monday as strong U.S. jobs data fuelled demand while other currencies struggle in narrow ranges.
The euro struggled to rise above $1.15 as cautious comments from the European Central Bank. ECB’s January meeting reaffirmed worries the euro zone economy was struggling. Concern around Brexit weighted on the pound. More stability in Europe and clarity on Brexit is needed before these currencies can rally meaningfully.
Against a basket of other currencies, the dollar edged 0.15% higher at 95.71 after two consecutive weeks of declines. Weak European data and expanding stimulus in China have increased demand for dollars.
A U.S. Labor Department report on Friday showed non-farm payrolls jumped by 304,000 jobs last month. Data exceeded forecasts and the largest gain since February 2018.
With much of Asia closed by holidays this week, the dollar also took heart from recently concluded China-US trade talks.
Rising U.S. yields also boosted the dollar. The benchmark 10-year U.S. Treasury yield was at 2.70%, up from a four-week low of 2.619% last week.
START TRADINGForex – Commodities – Narrow ranges for nearly all currencies saving dollar
Currency markets stayed in tight ranges in early Asian trade, with the euro trading flat at $1.1454.
Sterling was lower at $1.3062 in early Asian trade. Traders expect the pound to remain volatile as Brexit uncertainty still high. The British currency was down 0.2% at $1.3064 and down 0.1% against the euro at 87.64 pence.
The Bank of England is scheduled to meet later this week and widely expected to keep interest rates steady.
Sterling fell towards a one-week low on Monday. The pound has held on to most of the gains it racked up in January. Prime Minister Theresa May met lawmakers to try and overcome a parliamentary impasse that has raised fears among investors about a disorderly ‘no-deal’ Brexit.
China’s financial markets are closed all week for the Lunar New Year holiday. Other Asian markets are also closed for parts of the week, keeping wider market activity subdued.
Sources: Reuters, Investing, CNN money
PLEASE NOTE The information above is not investment advice.