Forexpros – The dollar fell against major global currencies on Thursday, as investors sold the greenback for profits after it rallied on U.S. Federal Reserve minutes from its latest meeting that revealed policymakers largely oppose stimulus measures to jolt the economy.
The euro rose against the dollar in Asian trading Thursday, with EUR/USD rising 0.05% and trading at 1.3148.
Federal Reserve minutes indicated voting members are growing less inclined to consider rolling out stimulus measures such as quantitative easing — bond purchases from banks — to steer the economy away from deflationary decline and closer to growth and hiring.
Such policies weaken the dollar as a side effect in exchange for price stability and a stronger labor market, and talk of their moving to the backburner sent the greenback rising in recent sessions.
The dollar continued its gains earlier on Thursday, as more bullish news hit the wire around the time of early Asian trading.
In the U.S., the ADP National Employment Report showed the country’s private sector added a net 209,000 nonfarm payrolls to the economy in March, above expectations for a gain of 200,000.
A stronger labor market makes monetary easing even more unlikely, and since the ADP report serves as a precursor to the official jobs report due out Friday, the dollar surged against other currencies although more bearish data did hit the wire.
In the U.S., the Institute of Supply Management said its non-manufacturing purchasing managers’ index declined by 1.3 points to 56.0 last month from a reading of 57.3 in February.
Analysts had expected the index, which gauges the health of the U.S. service sector, to decline by 0.3 points to 57.0 in March.
Meanwhile out of Europe, turnout at a Spanish bond auction fell a little short of expectations.
Spain’s Treasury sold EUR2.59 billion in government bonds at auction, short of a EUR3.5 billion target.
Following the auction, the yield on Spanish 10-year bonds climbed to 5.7%, up from 5.5% before the sale.
The Spanish government, meanwhile, has said the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Also in Europe, the European Central Bank decided to hold interest rates unchanged at 1.0%.
Weak indictors coupled with trouble brewing in Spanish bond markets could signal the European debt crisis is coming out of hibernation.
Nevertheless, the euro regained composure while the dollar succumbed to profit-taking in rather calm trading.
The greenback, meanwhile, was down against the pound, with GBP/USD up 0.08% and trading at 1.5902.
The greenback was down against the yen, with USD/JPY trading down 0.18% at 82.32, and down against the Swiss franc, with USD/CHF trading down 0.06% at 0.9152.
The greenback was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.05% at 0.9966, AUD/USD up 0.03% at 1.0273 and NZD/USD up 0.18% at 0.8163.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.05% at 79.87.
Later Thursday, the U.S. will release government data on unemployment claims.
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