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Forex - EUR/USD gains on lackluster U.S. jobs report

Published 08/01/2014, 12:31 PM
Updated 08/01/2014, 12:33 PM
Dollar slides as jobs numbers point to slackness in U.S. labor market

Investing.com - The dollar edged lower against the euro on Friday after data revealed the U.S. economy picked up fewer payrolls in July than markets were hoping.

In U.S. trading, EUR/USD was up 0.30% at 1.3431, up from a session low of 1.3378 and off a high of 1.3445.

The pair was likely to find support at 1.3367, Wednesday's low, and resistance at 1.3445, the session high.

The Labor Department reported earlier that the U.S. economy added 209,000 jobs in July, missing expectations for an increase of 233,000. The number of jobs added in June was revised up to a 298,000 gain from a previously estimated rise of 288,000.

The report also showed that the U.S. unemployment rate ticked up to 6.2% last month from 6.1% in June. Analysts had expected the rate to remain unchanged in July.

Investors avoided the dollar on the data to reexamine how much time will past from when the Federal Reserve will wind down its bond-buying stimulus program and when it will begin hiking benchmark interest rates.

While the economy is improving, the Fed noted in its July statement on interest rates this week that slackness remains in the labor market.

Elsewhere, the revised Thomson Reuters/University of Michigan consumer sentiment index rose to 81.8 in July from 81.3 in June, missing expectations for a reading of 82.0, which added to Friday's profit taking.

Separately in the U.S., the Institute of Supply Management reported that the U.S. manufacturing purchasing managers' index rose to 57.1 in July from 55.3 in June, beating expectations for an increase to 56.0, though investors avoided the greenback due to jobs and sentiments reports.

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Meanwhile in Europe, the Markit research group said that Germany's manufacturing purchasing managers' index fell to 52.4 last month from 52.9 in June. Analysts had expected the index to remain unchanged.

For the entire euro zone, Markit said the manufacturing PMI ticked down to 51.8 in July, from a reading of 51.9 the previous month. Analysts had also expected the index to remain unchanged.

Elsewhere, the euro was up against the pound, with EUR/GBP up 0.62% at 0.7979, and flat against the yen, with EUR/JPY unchanged at 137.64.

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