US recap: EUR/USD firms as dollar dips heading toward payrolls
Sept 5 (Reuters) -The dollar index fell for a third day Thursday, tracking Treasury yields lower in the run up to U.S. jobs data Friday amid fresh signs the US labor market is softening.
The ADP payrolls estimate of 99k was much weaker than street estimate of 145k though analysts tended to downplay the link between ADP and NFP. Challenger layoffs rose to the highest level in five months.
The dollar trimmed a steeper decline amid bouts of short-covering following a modest improvement in weekly jobless claims and stronger than expected August service PMIs.
Levels of overnight volatility remain elevated ahead of the U.S. employment report with yen just below 30%.
In politics, Republican presidential candidate Donald Trump said he would establish a government efficiency commission headed by billionaire supporter Elon Musk if he wins the Nov. 5 election and French President Emmanuel Macron appointed Michel Barnier, the EU's former Brexit negotiator, as his new prime minister on Thursday.
The latest Bank of England Decision Maker Panel survey (DMP) showed price pressures continue to ease with one-year and three-year inflation expectations remaining at 2.7%.
U.S. Treasury yields eased 1-3bp across maturities, according to LSEG data, with the 2s-10s curve flattening nearly 1bp to a barely inverted -1.74bp at the mid.
By New York afternoon trade, the S&P 500 had fallen 0.13%.
WTI slipped 0.30%, reversing earlier gains following a much larger-than-expected withdrawal from U.S. inventories and a two-month delay to output increases by OPEC+ producers.
Copper was up 1.31% amid broadly higher metals prices.
Gold rose 0.86% fueled by the weaker dollar, lower yields and concerns that an Israel-Hamas ceasefire deal was not near.
Heading toward the close: EUR/USD +0.18%, USD/JPY -0.21%, GBP/USD +0.17%, AUD/USD +0.14%, DXY -0.24%, EUR/JPY -0.01%, GBP/JPY -0.06%, AUD/JPY -0.09%, USD/CAD +0.01%.
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Editing by Burton Frierson
Robert Fullem is a Reuters market analyst. The views expressed are his own.
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