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Dollar steady above one-week low; eyes on U.S. jobs data

11/3/2017, 11:16:27 AMBasics of Trading
Dollar steady above one-week low; eyes on U.S. jobs data

The dollar held steady versus a basket of currencies on Friday, as focus shifted to U.S. jobs data, with President Donald Trump's nomination of Federal Reserve Governor Jerome Powell to be the next Fed chair coming as no surprise.

Trump on Thursday tapped Powell to lead the U.S. central bank, breaking with precedent by denying incumbent Janet Yellen a second term but signaling a continuation of her cautious monetary policies.

Trump's decision was in line with what market participants had been expecting, and the dollar showed limited reaction after the news.

The dollar index last stood at 94.696 (DXY), having pulled up from a one-week low of 94.411 set on Thursday.

The greenback had slipped on Thursday after Republicans in the U.S. House of Representatives released proposals to overhaul the tax code.

Republicans called for slashing the corporate tax rate to 20 percent from 35 percent, cutting tax rates on companies' foreign profits and on individuals and families. Congressional passage of the legislation, however, was far from certain.

While the contents of the tax reforms seem positive for the dollar, there is still uncertainty over how quickly it can be implemented, said Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore.

"This could be quite a drawn out process," Innes said, adding that U.S. jobs data due later on Friday, would be a near-term focus for the dollar.

Against the yen, the dollar eased 0.1 percent to 113.94 yen , trading below a 3-1/2 month high of 114.45 yen that had been set last Friday. The euro held steady at $1.1659 .

Sterling nursed its losses after suffering its biggest one-day fall against the dollar since June on Thursday, as the Bank of England raised interest rates for the first time in more than a decade but said it sees only gradual rises ahead.

Sterling held steady at $1.3056 , after having tumbled 1.4 percent on Thursday. The BoE voted 7-2 to increase its benchmark Bank Rate to0.50 percent from 0.25 percent, but said it expected only "verygradual" further increases.

The Australian dollar slipped 0.3 percent to $0.7689 , coming under pressure after data showed that Australian retail sales were flat in September, coming in below market expectations for a rise of 0.4 percent on the month.