Daily Morning Report 04.09.2015
The yen gathered pace on Friday as investors geared up for U.S. jobs data later in the day and shrugged off disappointing wages data. USD/JPY traded at 119.79, down 0.24%, while AUD/USD changed hands at 0.6995, down 0.33%. In Japan, preliminary wages data rose 0.6% year-on-year, well below the expectations of a 2.3% gain. Investors were looking ahead to Friday’s highly-anticipated jobs report for further indications on the strength of the economy and signs of a potential rate hike by the Federal Reserve this month. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.02% at 96.34. Overnight, the dollar held gains against the other major currencies on Thursday, after the release of mostly upbeat U.S. economic reports and as investors turned their attention to Friday’s highly-anticipated non-farm payroll data. The Institute of Supply Management reported that its non-manufacturing purchasing manager’s index fell 59.0 last month from 60.3 in July, above forecasts for a reading of 58.1. The report came after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending August 29 increased by 12,000 to 282,000 from the previous week’s total of 270,000. Analysts had expected initial jobless claims to rise by 5,000 to 275,000 last week. First-time jobless claims have held below the 300,000-level for 26 consecutive weeks, which is usually associated with a firming labor market. Data also showed that the U.S. trade deficit narrowed to $41.86 billion in July from a deficit of $45.21 billion in June, whose figure was revised from a previously reported deficit of $43.8 billion. Analysts had expected the U.S. trade deficit to narrow to $42.4 billion in July. The single currency weakened broadly after the European Central Bank indicated that it could expand its quantitative easing program amid increased downside risks to its inflation outlook. The ECB lowered its forecast for growth and inflation, citing oil prices and slowing growth in China.