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FOREX-Dollar falls broadly as U.S. jobs data weighs
April 3, 2013 / 1:46 PM / 4 years ago

FOREX-Dollar falls broadly as U.S. jobs data weighs

* ADP report shows private sector jobs gain lower than
expected
    * Dollar sluggish as a result; U.S. nonfarm payrolls awaited
    * Euro vulnerable before ECB meeting on Thursday

    By Gertrude Chavez-Dreyfuss
    NEW YORK, April 3 (Reuters) - The dollar fell across the
board on Wednesday after a report showed the U.S. private sector
created fewer jobs than expected last month, raising concerns
that recovery in the world's largest economy has stalled.
    The weaker-than expected ADP national employment report
followed soft U.S. manufacturing data on Monday which suggested
that the economy, on fire the last few weeks due to a run of
strong data, has lost some momentum. Still analysts were willing
to suspend judgment until Friday's U.S. non-farm payrolls
report.
    The ADP on Wednesday reported an increase of 158,000 in
private employment, much lower than the consensus forecast of
200,000. It did revise February's number to 237,000 from its 
initial reading of 198,000, but that did little to lift
sentiment. 
    "The disappointing headline did dent some of the recent
optimism surrounding the U.S. recovery and the overall
improvement in labor markets," said Omer Esiner, chief market
analyst at Commonwealth Foreign Exchange in Washington. 
    "While the ADP and broader non-farm payroll numbers have not
had the closest correlation over recent months, investors are
likely to go into Friday's jobs report a bit more cautious."
    Analysts were forecasting U.S. payrolls to hit 200,000 in
March, with the unemployment rate seen holding steady at 7.7
percent.
    The dollar index slipped 0.1 percent 82.822.
    The euro hit session highs against the dollar after the ADP
report, but was last at $1.2828, up 0.1 percent on the
day. 
    Europe's common currency, however, looked vulnerable given a
recent run of weak euro zone data that, when added to political
turmoil in Italy and concerns over Cyprus, could lead European
Central Bank President Mario Draghi to strike a dovish tone
hours in his post-meeting comments on Thursday.
    Against the yen, the dollar fell 0.2 percent to 93.24 
The U.S. currency remained well off a 3-1/2 year high of 96.71
yen set last month.
    Analysts said choppy moves in currencies were unlikely
before the end of the Bank of Japan's April 3-4 policy meeting,
in which it is widely expected to ramp up its bond buying and
extend the maturities of the bonds it purchases. 
    The dollar has climbed around 20 percent against the yen
since November, when markets first started pricing in more
aggressive monetary easing from the BoJ.
    As a result of wariness ahead of the meeting long positions
in the dollar versus the yen have likely been pared back over
the past few weeks, traders said. That lighter positioning may
limit the scope of any drop in the dollar after the BoJ's
decision on Thursday.

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