Dollar surges on strong jobs report
The dollar is up across the board Wednesday morning following a tremendously positive and surprising report on private sector jobs in the United States.
According to the ADP Employer Services report, private sector employers produced the highest jobs increases in the 10-year history of the study by adding 297,000 jobs during the month of December.
Analysts were shocked at the overwhelming report which was three times estimates and a significant improvement over the 92,000 private jobs added to the US economy in November.
While Friday’s broader report from the government should offer more insight on what is happening, some experts already say this report from ADP bolsters hopes for a more promising 2011 labor market.
As is often the case, cautious economists warn Americans to remain patient with the economy and jobs market. Wednesday’s data is good news, but additionally strong reports may be necessary to confirm a trend of improvements, versus a fluke.
Momentum currency and commodities traders certainly bought in as the dollar was up profoundly against most major currencies and was putting pressure on commodities.
The dollar is up over one pip on the yen in late morning New York trade at 83.27. The euro and pound are both down against the greenback as well. A euro is worth $1.3148 and a pound gets $1.5462.
Gold prices have been hammered the last two days after closing Monday at $1,414.60. A $33 dollar drop per ounce at Tuesday’s close has been followed by another $12 decline in current Wednesday gold trade. Gold is at $1,369.40 intraday.
Oil prices are also off under the weight of the dollar with a current rate of $88.35 per barrel of light sweet crude futures on the NYMEX. This is off $1.03 from Tuesday’s settle price.
A further confirmation of an improving jobs market Friday could produce another surge across the board for the dollar. A developing pattern in the coming weeks and months would likely mean a longer-term improvement for the buck.
About Pete Southern
Pete Southern is an active trader, chartist and writer for market blogs. He is currently technical analysis contributor and admin at this here blog.
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