US Dollar drops against the euro after the publication of weak data in US ADP employment report.
According to released on Wednesday ADP report, the number of jobs increased by 156 thousands in April. The growth rate for March was revised from 200 thousands to 194 thousands. Economists surveyed by Bloomberg expected the rise by 195 thousands in April.
However, the dollar index rises from the lowest level for the year as two heads of the Federal Reserve System (FRS) drew attention to the understated market expectations for US interest rates Central Bank, Bloomberg reported.
On Tuesday, the head of the Federal Reserve Bank (FRB) of Atlanta Dennis Lockhart and his colleague from the Federal Reserve Bank of San Francisco John Williams announced that the current state of the US economy justifies the rise of interest rates at the meeting on 14-15 June. In their view, the market is too conservative about the prospects of the US economy, and raising rates.
According to the data of futures contracts, the likelihood of Fed rate hike does not exceed 12% in June.
Euro rose to $1.1526 compared with $ 1.1496 at the close of the previous session in New York, for which the dollar has risen in price by 0.3%.
The dollar fell against the Japanese currency during Wednesday session to 106.27 yen from 106.60 yen yesterday. Yen decreased slightly against the euro – to 122.49 yen against 122.55 yen.
The People’s Bank of China (PBOC, the central bank of the country) lowered the reference rate of the yuan against the US dollar by 0.59% to 6.4943 yuan on Wednesday. The rate of the Chinese national currency was cut the with the fastest pace from August 13 after the strengthening of US currency on Tuesday, reports Bloomberg.
Since the beginning of 2016, the value of the yuan against the dollar has not changed much, but the yuan has fallen by 4.3% against a basket of currencies of major trading partners of China – to the lowest level since November 2014.