July 2, 2020 / 2:01 PM / a month ago

FOREX-Dollar weakens as strong U.S. jobs data dims haven appeal

    * U.S. economy creates 4.8 mln jobs
    * Safe-haven dollar also hurt by vaccine news
    * Dollar on pace to post losses for 2nd straight week
    * Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh

 (Adds analyst comment, more details on jobs report, updates prices)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, July 2 (Reuters) - The U.S. dollar fell on Thursday after data showing the world's largest
economy defying expectations for a second month in a row, creating jobs in June at a far faster pace than
market forecasts.
    The greenback was on track to post losses for a second straight week against a basket of major
currencies.
    Data showed that U.S. nonfarm payrolls increased by 4.8 million jobs in June, the most since the
government started keeping records in 1939. Payrolls rebounded 2.699 million in May. Economists polled by
Reuters had forecast payrolls increasing by 3 million jobs in June.
    The unemployment rate, meanwhile, fell to 11.1% last month from 13.3% in May. 
    The report further diminished the dollar's appeal as a safe haven.
    "Everything still seems to be heading in the right direction. Right now, expectations are pretty high
that the economy is rebounding back," said Edward Moya, senior market strategist at OANDA in New York.
    In midmorning trade, the dollar index slid 0.1% to 97.064, as the euro rose 0.1% versus the
greenback to $1.1262.
    Traders are focused on whether the euro can close above $1.13 and OANDA's Moya said it could happen.
    "This is going to support the belief that a massive weakening in the U.S. dollar is upon us because
there's still optimism that risky assets are going to shine because the Federal Reserve is going to remain
very accommodative," Moya said. 
    Despite the dollar's recent spell of weakness, the greenback is still up 2.5% from the 2020 low of
94.6 in the dollar index hit in early March. A Reuters poll predicts more weakness for the greenback over
the next 12 months due to weak global demand.
    The dollar, however, gained 0.1% against the yen to 107.59 yen.
    The U.S. currency had been buffeted earlier in the session by news that a COVID-19 vaccine developed
by German biotech firm BioNTech and U.S. pharmaceutical giant Pfizer had shown potential
in early-stage human trials.
    
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    Currency bid prices at 9:41AM (1341 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1263        $1.1250     +0.12%         +0.47%      +1.1302     +1.1248
 Dollar/Yen       JPY=        107.5800       107.4600    +0.11%         -1.18%      +107.7200   +107.3400
 Euro/Yen         EURJPY=     121.17         120.90      +0.22%         -0.64%      +121.4300   +120.7700
 Dollar/Swiss     CHF=        0.9446         0.9457      -0.12%         -2.40%      +0.9464     +0.9427
 Sterling/Dollar  GBP=        1.2491         1.2470      +0.17%         -5.79%      +1.2529     +1.2462
 Dollar/Canadian  CAD=        1.3578         1.3585      -0.05%         +4.56%      +1.3611     +1.3564
 Australian/Doll  AUD=        0.6932         0.6914      +0.26%         -1.27%      +0.6943     +0.6905
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.0639         1.0640      -0.01%         -1.96%      +1.0661     +1.0639
 Euro/Sterling    EURGBP=     0.9015         0.9018      -0.03%         +6.64%      +0.9032     +0.9006
 NZ               NZD=        0.6521         0.6475      +0.71%         -3.19%      +0.6536     +0.6475
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        9.4753         9.5133      -0.40%         +7.94%      +9.5302     +9.4396
 Euro/Norway      EURNOK=     10.6716        10.7025     -0.29%         +8.47%      +10.7260    +10.6480
 Dollar/Sweden    SEK=        9.2943         9.3064      -0.03%         -0.56%      +9.3157     +9.2378
 Euro/Sweden      EURSEK=     10.4689        10.4716     -0.03%         +0.00%      +10.4811    +10.4313
 

    
 (Reporting by Gertrude Chavez-Dreyfuss; Editing by Andrea Ricci and Jonathan Oatis)
  
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