europe: The euro is on thin ice in front of U.S. labor data


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On Friday, the euro was held at a low of 20 years. It seemed to be able to rest after its worst week in two weeks as investors waited. EuropeTo tip into recession, markets awaited U.S. employment data to determine the next direction for dollar.

Fears of gas shortages in Europe are causing the euro to fall more than 2% this week. This could lead to a slowdown in economic growth and a drop in euro value. It fell to $1.0144 overnight, a low of two decades. Now it is just above parity with the last purchase at $1.0185.

The euro’s slide has pushed the U.S. Dollar index to a new two-decade high at 107.270 this Week. Last week, the index was just below that level. It was down 0.1% in Asia at 106.1840.

“Europe is vulnerable to large risks about energy dependence, a cost-of-living crunch for consumers, and fragmentation risk. Analysts at Citi said that this means euro/dollar is lower.

Friday’s Australian dollar gain was 0.3% to $0.6850. This is a drop from $0.6762 in two years. It also benefited from an infrastructure-led stimulus program in China, which traders believe will increase demand for raw materials.

Sterling looks to have gotten through a week in British political chaos fairly well. The currency is currently down 0.3%, but it rebounded a little overnight after Prime Minister Boris JohnsonQuit, end all uncertainty about his next steps. [GBP/]

The pound was last valued at $1.2053, and it was poised for its highest week in over two years against the euro.

The New Zealand dollar gained 0.3% to $0.6192, and it looks like it will continue its steady rise. As investors seek safety and security, growing unease about the global economic outlook has slowed the Japanese yen’s slide to 135.94 dollars.

Even though rising energy prices are likely to derail confidence and growth across Europe, investors remain concerned about the U.S. economic outlook, even though recent data have been better than anticipated.

The next indicator is the U.S. nonfarm payrolls figures, due at 1230 GMTEconomists predict that 268,000 new jobs will be created in June.

A stronger figure could ease some recession fears, but it would likely increase rate hike bets. This could also lift the dollar.

“Stronger payrolls gains would underpin the expectations for an ever-more aggressive future.” Fedpolicy stance” Commonwealth Bank of AustraliaStrategist Carol KongSydney

Alan Ruskin, strategist at Deutsche Bank, also stated that simply meeting expectations would suffice to make it possible to talk about “U.S. In the face of a global shock to energy, exceptionalism is possible.

This can help keep the dollar bid high, he stated.

The dollar has been strong in emerging markets as well, pushing several Asian currencies to their lowest levels in many years and India’s rupee to an unprecedented low. [EMRG/FRX]

Bitcoin is showing some signs of recovery and has gained nearly 15% in the past week to $22,100.


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