The Dollar Decline with the Non Farm Payroll for April

The Non Farm Payroll

The April Non Farm Payroll reported a loss of 539k jobs compared revised 699k job loss in March. Forecasts expected a loss of about 600k to 610k jobs.

The Unemployment Rate

But the Unemployment Rate for April was not at all a surprise. As expected the unemployment in the US is still on the raise. The Unemployment Rate for April jumped to 8.9 from 8.5% in March. This is a new record high in 25 years.

The Dollar Decline

The dollar declined against the majors following the Non Farm Payroll and Unemployment Rate Reports for April.

May 8 (Bloomberg) — The dollar declined to a one-month low against the euro as a government report showed U.S. employers cut fewer jobs last month than economists forecast, reducing demand for the safety of the greenback.

Traders continued the shift to riskier assets, boosting up the Euro. This could also be a continuation of bounce of the Euro after announcement of the Interest Rate cut and the announcement of the proposed purchase of 60 billion worth of Covered Bonds by the ECB. The Euro Dollar rate shot to above the 1.36-level.

The prevailing flow now is negative for the dollar, negative for the yen, positive for the commodity-linked currencies and higher yielders,

Right now the report is given a positive spin by the market. The market is grabbing on the green-shoot rally.

Source: Bloomberg; Michael Woolfolk, senior currency strategist at Bank of New York Mellon in New York.

People have been so bearish on the euro in general. Indeed, what we’re seeing is euro-dollar breaking higher, and our recommendation is to buy the euro.

The euro may rise to $1.40 in two weeks

Source: Bloomberg; Sebastien Galy, a currency strategist at BNP Paribas Securities SA in New York.

The dollar was headed for a third weekly decline versus the euro, weakening 1.6 percent in the longest losing streak this year. Against the yen, the dollar was little changed this week, while the euro rose 1.7 percent.

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6 Responses to “The Dollar Decline with the Non Farm Payroll for April”

  1. Naoko (1 comments.) says:

    Wow, Thats alot of unemployed people.. I cant imagine what here in Japan could be.

  2. fx trading (1 comments.) says:

    the dollar will continue to depreciate as the economy worsens.

  3. forexwatch says:

    I agree with you. It will continue to deteriorate.

  4. forexwatch says:

    I think Japan is also facing the financial crisis and unemployment problem as well.

  5. EOqt from SRom Machine (1 comments.) says:

    I totally i agree with you. Thanks for sharing information with us…..

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  6. am from Sgolf sets (1 comments.) says:

    Nice sharing. This information really very useful for us.
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    Thanks for sharing.

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