On Monday, the Us dollar is on the defensive territory, as the favorable news about the employment market in the USA have calmed down the markets and increased the demand in the euro and the currencies which the economic growth is supporting. The US dollar is defenseless versus the yen after it did not manage to hold the positions following Friday data on payrolls, thought the fears about the possible intervention of the Japanese authorities withhold the traders from the further yen purchases.
When the risk appetite returns the yen is weakening as well as the US dollar does. As the US dollar has a low interest rate regardless of the deficit in the USA, its weakness is usually singled out even concerning the yen, thinks Tohru Sasaki from the J.P. Morgan Chase Bank. This indicates that the USD/JPY pair is hardly to upturn no matter if the world markets take the risk or not. The non-farm payrolls in the USA declined by 54,000 in August, with the consensus forecast equaling to 100,000. The private sector employment ascended more than expected. The increasing appetite to risk in the recent months has a tendency to support the euro and the high-yield currencies as the investors perceive the US dollar like the currency for financing the investments in the expectations of the prolonged period with the US low interest rate.
The euro uprose versus the US dollar to $1.2887. Following the release of the data concerning the labor market on Friday it jumped up to $1.2898 which is the maximum of two weeks.
The US dollar decreased against the yen by 0.05 % to 84.33, staying not far from a 15-year low of 83.58, hit in August. After the reports on the employment it grew for a short term to 85.23 though pared the recent highs rapidly. The yen is popular lately, since the investors usually make the choice taking into account the currencies of the countries with the surplus of the current account, if they want to avoid the risky assets. The positive balance of payments in Japan denotes that the number of the US dollars sold to the Japanese exporters exceeds the number of the US dollars bought by the Japanese importers, which is curbing the growth of the yen versus the yen.
Few analysts though state that the US dollar can escalate in the end, in particular, if the profit of the Japanese bonds stops growing. The US dollar is likely to be recovering which will support the pair’s upturn to 85-86 yens, confirms Masafumi Yamamoto from Barclays.
The US dollar index – the indicator of the US dollar fluctuations versus the set of six major currencies, has lowered by 0.13% to 81.996.
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