Euro Recovers Against Most Majors; U.S. Jobs Data Eyed

Euro Recovers Against Most Majors; U.S. Jobs Data Eyed


The euro strengthened against most major currencies on Friday, thereby recovering the losses it incurred on Thursday amid disappointment over the European Central Bank's steps to cope with the eurozone debt crisis.
The euro was under heavy selling pressure yesterday as the European Central Bank President Mario Draghi failed to announce any measures to curb the region's debt crisis.
Draghi told reporters that the central bank "may undertake outright open market operations," but traders seemed disappointed that there was not more conviction behind his remarks. Last week, Draghi promised to do whatever is necessary to support the beleaguered eurozone, leading to a rally on Wall Street.
The euro's rise came today as investors are now bracing for the U.S. jobs data due out later in the day for cues.
Economists expect the Labor Department report to show that U.S. employment rose by about 100,000 jobs in July following a weaker than expected increase of 80,000 jobs in June. The unemployment rate is expected to remain unchanged at 8.2 percent.
Any upside surprise in employment could temper hopes of more stimulus from the Federal Reserve, which earlier this week signaled it is prepared to act unless the economy stages an unlikely comeback in the next six weeks.
A surprisingly strong jobs report could also boost the dollar, while a weaker-than-expected jobs number will put the dollar under fresh pressure.
The euro is now worth 1.2205 against the dollar, up 0.6 percent from yesterday's 1-week low of 1.2136. If the euro-dollar pair rises further, it will target the 1.225 level.
Against the Japanese yen, the euro is trading at 95.52, compared to a 1-week low of 94.95 hit yesterday. The next upside target level for the euro-yen pair is seen at 95.8.
The euro also followed a similar trend against the pound, with the pair bouncing back from yesterday's 2-day low of 0.7827. At present, the pair is worth 0.7867 with 0.790 seen as the next upside target level.
Looking ahead, services PMI reports for July from Eurozone and U.K. and the Eurozone retail sales for June are due shortly.


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