Dollar nurses losses as U.S. economic doubts undercut rally

TOKYO (Reuters) – The dollar nursed losses against most currencies on Monday as disappointing U.S. jobs data caused some investors to scale back bets on a rebound in the greenback.

The euro held gains versus the dollar but faces a test later on Monday with data that is expected to show German industrial output growth slowed at the end of last year.

Speculators have been reducing short positions in the dollar, but some analysts say better U.S. economic data and continued progress in fighting the coronavirus pandemic will be needed for further dollar gains.

“Soft non-farm payrolls has really pulled the ladder out from under the dollar,” said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities.

“Now the markets are questioning whether the dollar can rise any further. A lot depends on the coronavirus, but we also need to know when U.S. fiscal stimulus will pass.”

Against the euro, the dollar traded at $1.2048 after a 0.7% slump on Friday.

The British pound bought $1.3736, close to an almost three-year high.

The dollar was quoted at 105.38 yen, having pulled back from a three-month high reached on Friday.

The U.S. economy created fewer jobs than expected in January while job losses the previous month were deeper than initially reported, data at the end of last week showed.

The release of U.S. consumer prices and consumer sentiment later this week will help determine whether a recent rise in inflation expectations and Treasury yields was justified.

Any disappointing numbers from either report could knock the dollar lower, some analysts warn.

The dollar index against a basket of six major currencies stood at 91.084, nursing a 0.6% loss from Friday.

Speculators’ net bearish bets on the dollar fell to $29.95 billion for the week ended Feb. 2, compared with a net short position of $33.81 billion for the previous week, according to calculations by Reuters and U.S. Commodity Futures Trading Commission data.

In the cryptocurrency market, ethereum fell 3.88% to $1,615, extending a pullback from a record high ahead of the listing of ethereum futures on the Chicago Mercantile Exchange.

Bitcoin, the most popular cryptocurrency, fell 0.88% to $38,936.

Elsewhere, the Australian dollar held steady at $0.7678. Across the Tasman Sea, the New Zealand dollar edged up to $0.7209.

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Currency bid prices at 2358 GMT

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Euro/Dollar $1.2048 $1.2050 -0.02% -1.39% +1.2060 +1.2032

Dollar/Yen 105.3800 105.3550 +0.05% +2.05% +105.4250 +105.4050

Euro/Yen 126.98 126.93 +0.04% +0.04% +127.0600 +126.8700

Dollar/Swiss 0.8990 0.8986 +0.00% +1.57% +0.8992 +0.8986

Sterling/Dollar 1.3736 1.3736 +0.00% +0.54% +1.3738 +1.3712

Dollar/Canadian 1.2759 1.2757 +0.02% +0.20% +1.2765 +1.2750

Aussie/Dollar 0.7678 0.7679 +0.03% -0.16% +0.7682 +0.7660

NZ 0.7209 0.7194 +0.25% +0.43% +0.7212 +0.7175

Dollar/Dollar

All spots

Tokyo spots

Europe spots

Volatilities

Tokyo Forex market info from BOJ

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