Dollar Holds Gains Before Jobs Data as GDP Boosts Fed Taper Bets

The dollar held gains against most major peers before a U.S. jobs report today and after data yesterday showed the economy expanded more than forecast, fueling bets for an earlier taper in Federal Reserve stimulus.

The U.S. currency headed for a second weekly gain against the euro as a Bloomberg measure of U.S. economic surprises turned positive for the first time in almost a month. The euro was set for a second weekly loss versus the yen after the European Central Bank unexpectedly cut interest rates to a record yesterday. Australia’s dollar fell after the central bank reduced its growth forecast for next year.

The dollar was little changed at $1.3414 per euro as of 9:44 a.m. in Tokyo from yesterday, when it touched $1.3296, the strongest level since Sept. 16. The greenback bought 98.19 yen from 98.09. Japan’s currency traded at 131.72 per euro from 131.63 in New York, when it gained 1.3 percent.

The dollar has risen 0.5 percent against the euro this week, following a 2.3 percent rally last week. It has fallen 0.5 percent versus the yen, while Japan’s currency has gained 1 percent over the euro.

(Source: Bloomberg)