The dollar edged lower in early European trade Monday, continuing its weakness after falling to a two-month low on the back of Friday’s disappointing U.S. jobs report, which pointed to the ultra-low interest rate policy staying in place for some time. Friday’s U.S. employment report for April came in well below expectations, with nonfarm payrolls only rising by 266,000 during the month, after robust private payrolls data from the ADP and weekly initial claims numbers had lifted expectations to a one million-plus rise. Attention will now switch this week to inflation data, although the mantra from Fed policymakers that the increase is due to temporary factors will carry extra weight following the jobs data.
The daily chart indicates there is plenty of room to the upside over .7862 with the February 25 main top at .8007 the primary upside target.
It’s another busy week ahead on the economic calendar. While stats will influence, central bank chatter in the week, and COVID-19 vaccine news will also infuence.