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USD/JPY Reverses Losses Ahead of Jobs Report

12/8/2017, 10:40:36 AMTrading Strategies
USD/JPY Reverses Losses Ahead of Jobs Report

 The dollar rose against a basket of major currencies on Thursday as upbeat labor market data, spurred expectations for a solid nonfarm payrolls report due Friday.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.10% to 93.62.

The {{ecl-294|s| number of individuals who filed for unemployment insurance}} for the week ended Dec 2. fell by 4,000 to 236,000, beating expectations for a drop of just 2,000.

The update on initial jobless claims comes a day ahead of nonfarm payrolls data expected to show the US economy created 200,000 jobs in November.

Market participants remained optimistic that November nonfarm payrolls data will continue to rebound following a slump in September in the wake of hurricane-related disasters.

"After the hurricane-related disruption that hit September's payroll tally, prompting a bounce back in October, employment growth should now revert to its previous trend of between 150,000 and 200,000 per month," said Capital Economics chief U.S. economist Paul Ashworth.

The yen, meanwhile, reversed gains against the greenback as investor focus shifted from Bank of Japan governor Haruhiko Kuroda's somewhat hawkish comments toward signs of progress on US tax reform.

Kuroda said Thursday that changes in the country’s economy and financial system could force the bank to raise its yield targets, fuelling expectations that the central bank may start to consider reining its ultra-loose monetary policy measures.

USD/JPY rose 0.44% to Y112.76, recovering from an overnight session low of Y112.22.

GBP/USD rose 0.24% to $1.3424, as investors continued to bet that the Irish border issue, which has stalled brexit talks so far, would be resolved soon, paving the way for UK-EU negotiations on several important factors including a trade deal.

EUR/USD rose 0.03% to $1.1799, while EUR/GBP fell 0.22% to £0.8788.

USD/CAD added 0.29% to $1.2824 as an upbeat Canadian Ivey report had little impact on the pair