Daily Afternoon Report 06.05.2015

The dollar extended losses against a basket of other major currencies on Wednesday, after data showed that U.S. non-farm private employment rose less than expected in April, fuelling concerns over the strength of the U.S. labor market.
In a report, payroll processing firm ADP said non-farm private employment rose by 169,000 last month, below expectations for an increase of 200,000. The economy created 175,000 jobs in March, whose figure was downwardly revised from a previously reported increase of 189,000.
The dollar also remained under pressure after the latest U.S. trade data indicated that the economy may have contracted in the first quarter.
Investors were looking ahead to a speech by Federal Reserve Chair Janet Yellen, which would be closely watched for any indications on the timing of the first hike in interest rates.
EUR/USD gained 0.66% to 1.1259 after data showed that euro zone private sector activity remained solid in April.
The euro area final composite purchasing managers’ index came in at 53.9 in April, up from a preliminary reading of 53.5 and just below March’s 11-month high of 54.0.
A separate report showed that euro zone retails sales fell 0.8% in March, worse than forecasts for a 0.7% decline.
The pound pushed higher, with GBP/USD up 0.43% to 1.5243 after data showed that growth in the U.K. service sector jumped to an eight-month high in April.
Research firm Markit said the U.K. services PMI rose to 59.5 in April from 58.9 in March. Economists had forecast a decline to 58.5.
But investors remained cautious ahead of Thursday’s elections which were widely expected to result in a hung parliament and an unstable coalition government.
Elsewhere, the dollar was lower against the yen and the Swiss franc, with USD/JPY slipping 0.15% to 119.66 and with USD/CHF declining 0.53% to 0.9217.
The Australian dollar was higher, with AUD/USD up 0.82% to 0.8006, while NZD/USD dropped 0.81% to 0.7498.
The kiwi weakened after Statistics New Zealand reported that the number of employed people rose by 0.7% in the first quarter, disappointing expectations for a 0.8% gain, after an increase of 1.2% in the last three months of 2014.
The report also showed that New Zealand’s unemployment rate rose to 5.8% in the three months to March from 5.7% in the previous quarter, compared to expectations for a decline to 5.5%.
USD/CAD slid 0.49% to trade at 1.2008.

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