The dollar is posting slight gains against all of its major rivals Wednesday afternoon. U.S. economic data was mixed this morning, with private sector employment increasing more than expected, while the service sector PMI came in below expectations. Investors appear more focused on the employment data ahead of Friday’s all important jobs report.
Ahead of the release of the Labor Department’s more closely watched monthly jobs report on Friday, payroll processor ADP released a report on Wednesday showing that U.S. private sector employment rose by a little more than expected in the month of July.
ADP said private sector employment increased by 179,000 jobs in July after climbing by an upwardly revised 176,000 jobs in June. Economists had expected employment to grow by about 170,000 jobs compared to the addition of 172,000 jobs originally reported for the previous month.
After reporting strong U.S. service sector growth in the previous month, the Institute for Supply Management released a report on Wednesday showing that the pace of growth in the sector slowed by more than expected in the month of July.
The ISM said its non-manufacturing index declined to 55.5 in July after jumping to a seven-month high of 56.5 in June. Economists had expected the index to show a more modest drop to 56.0.
The dollar has climbed to around $1.1145 against the Euro Wednesday, from yesterday’s 1-month low of $1.1233.
The euro area private sector expanded more than estimated in July, final survey data from Markit showed Wednesday. The final composite output index rose to a 6-month high of 53.2 in July from 53.1 in June. According to flash estimate, the index fell to 52.9.
Eurozone retail sales remained flat as expected in June, data from Eurostat showed Wednesday. Sales remained stable in June from May, when it climbed 0.4 percent. Sales of food, drinks and tobacco edged up 0.1 percent and that of non-food products moved up 0.3 percent.
The Bank of England is widely expected to cut interest rates to new record lows Thursday, in response to Brexit-induced economic uncertainty.
The buck has bounced back to around $1.3315 against the pound sterling this afternoon, from a 2-week low of $1.3371 this morning.
British service sector shrunk for the first time in over three-and-a-half years and at the fastest pace in more than seven years, amid the uncertainty linked to “Brexit”, survey data from Markit Economics and the Chartered Institute of Procurement & Supply showed Wednesday.
The Markit/CIPS business activity index for services declined to 47.4 from 52.3 in June, in line with a flash estimate released on July 22. The monthly drop of 4.9 points was the biggest since the survey began in July 1996, Markit said.
Shop prices in the United Kingdom fell 1.6 percent on year in July, the British Retail Consortium said on Wednesday. That follows the 2.0 percent decline in June.
Members of the Bank of Japan’s monetary policy board are expecting the decade-plus blight of deflation to persist for a bit longer, minutes from the central bank’s June 15 and 16 meeting revealed on Wednesday.
The bank’s considerable efforts to fight deflation were derailed last year by plummeting energy prices that have yet to recover.
“On the price front, the year-on-year rate of change in the consumer price index is about 0 percent. Although inflation expectations appear to be rising on the whole from a somewhat longer-term perspective, they have recently weakened,” the minutes said.
The bank added that the Japanese economy continues to recover at a moderate pace, although exports and production are expected to remain sluggish.
The greenback has risen to around Y101.250 against the Japanese Yen Wednesday, from an early low of Y100.733.
The services sector in Japan turned to expansion in July, the latest survey from Nikkei revealed on Wednesday with a services PMI score of 50.4. That’s up from 49.4 in June, and it moves above the boom-or-bust line of 50 that separates expansion from contraction.



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