FOREX

FOREX-Dollar swings with yields in markets nervous ahead of jobs data – Reuters


    * Dollar bounces back from weak private employment report
    * Dollar upturn comes as yields rise on Fed official's
comments
    * Kiwi climbs again
    * Ether rises ahead of change in blockchain network 

 (New throughout, updates prices, market activity; new byline,
changes dateline, previous NEW YORK/LONDON)
    By David Henry
    NEW YORK, Aug 4 (Reuters) - The dollar recovered quickly
from a fall on Wednesday when comments from a top U.S. Federal
Reserve official appeared to suggest that the central bank may
reduce support for the improving economy more quickly than
widely thought.
    The official's bullish comments on the U.S. economy
triggered a rebound in U.S. Treasury yields and turned currency
market attention away from the release, just two hours earlier,
of an unexpectedly weak private employment report.

    The dollar swung from being down 0.3% for the day to up
0.3%on the opposing clues on whether the U.S. will see strong
economic growth and higher interest rates or a serious drag from
the coronavirus pandemic.
    The ADP National Employment Report was seen as possibly 
foreshadowing softness in jobs data due on Friday from the
American government.
    The currency markets have been expecting Friday's non-farm
payrolls report to be the next big catalyst for exchange rates,
followed by comments expected at a symposium of central bankers
at the end of this month in Jackson Hole, Wyoming.
    At mid-day in New York, the dollar index against major
currencies was up 0.3% to 92.268.
    The Japanese yen, often seen as a competing safe haven, was
a big beneficiary of the dollar's initial fall on the ADP report
and gained to 108.77 per dollar, but couldn't hold the break
below 109. The dollar was last trading at 109.54 yen, up 0.5%.

    The euro and British pound also swung against the greenback.
The euro was last trading at $1.1836, off 0.2% for the
day. Sterling was down 0.1% to $1.3903. 
    The initial downdraft came when the ADP National Employment
Report showed U.S. private payrolls increased about half as much
as economists had expected, likely constrained by shortages of
workers and raw materials.
    "It was a fairly big disappointment," said Mazen Issa,
senior currency strategist at TD Securities.
    The ADP report has a mixed record of predicting the
government report, Issa said, but added, "the miss is
substantial enough that the markets may be a little bit more
nervous going into Friday's report."
    Federal Reserve Chair Jerome Powell and other policy makers
have recently emphasized that upcoming employment reports will
be critical to the board's decisions about when and how to cut
back on support for the economy.
    The dollar has lost value in recent weeks as declining
yields have made strategists question whether the U.S. economy
will grow as much as they had expected in light of the spread of
the highly contagious Delta variant of COVID-19.
    The New Zealand dollar made strong gains for the second
consecutive day, after a drop in unemployment in the country
raised expectations that rate hikes could begin within weeks.
    The kiwi was last up 0.4% against the U.S. dollar, at
$0.7044.    
    The country's central bank had said on Tuesday it would soon
begin consulting on ways to tighten mortgage lending standards,
as it tries to control an inflated housing market.
    Ether, the second-largest cryptocurrency, rose 8% to
$2,706.17 ahead of an upcoming change in the Ethereum
blockchain network that will take some tokens out of
circulation.
    Bitcoin rose 3% to $39,421.  
    
========================================================
    Currency bid prices at 12:21PM (1621 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct       High Bid    Low Bid
                                              Previous                   Change                   
                                              Session                                             
 Dollar index                 92.2680        92.0360     +0.27%         2.542%        +92.3110    +91.8140
 Euro/Dollar                  $1.1836        $1.1865     -0.24%         -3.13%        +$1.1899    +$1.1833
 Dollar/Yen                   109.5400       109.0300    +0.47%         +6.02%        +109.6700   +108.7250
 Euro/Yen                     129.64         129.35      +0.22%         +2.14%        +129.8100   +129.1500
 Dollar/Swiss                 0.9066         0.9041      +0.29%         +2.49%        +0.9076     +0.9019
 Sterling/Dollar              $1.3903        $1.3914     -0.07%         +1.77%        +$1.3957    +$1.3899
 Dollar/Canadian              1.2548         1.2535      +0.09%         -1.47%        +1.2562     +1.2516
 Aussie/Dollar                $0.7376        $0.7393     -0.23%         -4.11%        +$0.7426    +$0.7370
 Euro/Swiss                   1.0731         1.0726      +0.05%         -0.70%        +1.0740     +1.0724
 Euro/Sterling                0.8512         0.8529      -0.20%         -4.76%        +0.8532     +0.8506
 NZ                           $0.7044        $0.7019     +0.37%         -1.89%        +$0.7088    +$0.7018
 Dollar/Dollar                                                                                    
 Dollar/Norway                8.8355         8.8215      +0.19%         +2.92%        +8.8480     +8.7780
 Euro/Norway                  10.4596        10.4650     -0.05%         -0.07%        +10.4778    +10.4180
 Dollar/Sweden                8.6101         8.5979      -0.14%         +5.05%        +8.6126     +8.5666
 Euro/Sweden                  10.1908        10.2049     -0.14%         +1.14%        +10.2130    +10.1838
 
    
 (Reporting by David Henry in New York and Iain Withers in
London; editing by Kirsten Donovan)
  

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