(MENAFN– ecpulse)
The U.S. dollar fell against the euro and the yen on Monday, together with weakening Treasury yields, as investors took in some gains from last week’s strong jobs report and speculated about the Federal Reserve’s interest rate increase.
U.S. bonds recovered from a selloff heading into last week`s employment report, which showed nonfarm payrolls increased by 288,000 jobs last month and the unemployment rate fell to 6.1 percent from 6.3 percent in May.
The next main focus will be the release on Wednesday of minutes from the Fed’s June meeting, which will be scanned for signs about when central bank members see an interest rate increase as likely.
The U.S. dollar has been trading between a wall against the euro and the yen for the past couple of months as benchmark 10-year Treasury yields have held below 2.66%.
Bond yields have remained relatively low despite data that signaled the U.S. economy is rebounding from a weak start to the year. 10-year Treasury yields were last down 2.1 basis points at 2.617%.
The fact that yields are unable to make a sustainable gain is keeping the U.S. dollar held back.
-The Dollar fell 0.17% against the yen to 101.86 yen, down from 102.10 late Friday.
-The Dollar fell 0.09% against the Euro to $ 1.36045 , after having earlier hit a high of $1.3577, in the wake of data that showed a sharp fall in German industrial production.
The disappointing German data kept alive expectations the European Central Bank may need to loosen monetary policy further in coming months in the face of disinflationary pressures and subdued economic growth.
The Dollar Index, which tracks the value of the U.S. dollar against a basket of major currencies fell to 80.26, after earlier reaching a high of 80.40.
Goldman Sachs economists on Monday brought forward their expectations of the first rate increase to the third quarter of 2015 from the first quarter of 2016, following similar actions from some other banks last week.
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