Dollar climbs to three-week peak in wake of strong U.S. data
The dollar rose to a three-week high on Thursday, bolstered by stronger-than-expected U.S. jobs data that suggested an improving labor market and reinforced signs that the world’s largest economy was on its way to recovery from the COVID-19 pandemic.
The greenback, which was already on solid footing ahead of reports on jobless claims and private payrolls, climbed to three-week peaks against the euro and two-month highs versus the yen.
U.S. private payrolls increased by 978,000 jobs in May, the ADP National Employment Report showed, the biggest increase since June 2020. Economists polled by Reuters had forecast private payrolls would increase by 650,000 jobs.
At the same time, U.S. initial jobless claims dropped below 400,000 last week for the first time since the pandemic started more than a year ago.
In afternoon trading, the dollar index, which measures the greenback against a basket of six currencies, rose 0.7% to 90.5040. It hit a three-week high of 90.554 and found strong support around the 89.946 mark in recent sessions after falling 2% in April and a further 1.6% in May.
The euro, meanwhile, fell 0.7% against the dollar to $1.2123 after earlier sliding to three-week low of $1.2118.
Against the yen, the dollar gained 0.6% to 110.245 yen. Earlier, the greenback advanced to two-month highs of 110.315 yen.
U.S. Treasury yields rise slightly as labor market data improves
U.S. bonds yields rose slightly on Thursday as two new data releases pointed to a continued recovery in the U.S. labor market.
The yield on the benchmark 10-year Treasury note rose about 4 basis points to 1.63% by 4:00 p.m. ET. The yield on the 30-year Treasury bond ticked up to 2.3%. Yields move inversely to prices and 1 basis point equals 0.01%. After a gain to start the year, rates have been stuck around these levels for six weeks.
Reference: CNBC
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