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Dollar Holds Steady Against Major Currencies
The dollar held steady against major currencies such as the yen and the euro on Wednesday, January 7, as investors assessed U.S. labor market data and its potential implications for monetary policy.
U.S. Labor Department data showed that job openings fell more than expected in November as hiring slowed, reflecting continued weak demand for labor. According to ADP Research, U.S. services sector activity unexpectedly accelerated in December, while private-sector job growth fell short of estimates.
Investors are now awaiting the release of the non-farm payrolls report on Friday, the most comprehensive and closely watched data in the markets.
- The dollar edged up slightly by 0.06% to 0.796 Swiss francs, while slipping by the same percentage to 156.56 yen.
"The focus will be on the employment data at the end of the week, as the market is still looking for inflation indicators as the clearest indicator of the dollar's direction against other currencies," said Olivier Bellemare, vice president of options and structured products trading at Monex Canada.
The dollar index, which measures the performance of the US currency against a basket of major currencies, rose 0.04%.
The euro dipped slightly after German inflation fell more than expected in December, prompting traders to reduce their expectations for an interest rate hike as early as 2027. The euro slipped 0.03% to $1.1684, after falling 0.28% on Tuesday.
The Australian dollar hit its highest level since October 2024 at $0.6766, supported by a mixed inflation report that kept the possibility of an interest rate hike alive. Meanwhile, the New Zealand dollar fell 0.14% to $0.5777.
