Moneycontrol
Mar 09, 2012 10:38 AM IST | Source: Forexpros.com

Forex - U.S. dollar lower on risk embrace

Forex - U.S. dollar lower on risk embrace

Forexpros -
Forexpros - The U.S. dollar traded lower against its major counterparts Wednesday, as hopes for a successful Greek debt swap increased risk sentiment across the board.

During U.S. morning trade, the dollar dropped against the euro, with EUR/USD climbing 0.21% to hit 1.3141.

A report by U.S. payroll processing firm ADP showed non-farm private employment rose by a seasonally adjusted 216,000 in February, beating expectations for an increase of 205,000.

The previous month's figure was revised up to a gain of 173,000 from a previously reported increase of 170,000.

Meanwhile, investors remained cautious before Thursday's deadline for Greece's private creditors to agree to a bond swap deal targeted at writing down 53.5% of the country's EUR177 billion debt.

A participation rate of more than 75% of creditors is required for Greece to secure a EUR130 billion bailout in order to avoid a default when a bond repayment due on March 20.

Sentiment on the single currency was weakened earlier after official data indicated German factory orders fell unexpectedly in January.

The greenback traded lower against the pound, with GBP/USD climbing 0.15% to hit 1.5739.

Elsewhere, the greenback was higher against the yen and but lower against the Swiss franc, with USD/JPY adding 0.34% to hit 81.17 and USD/CHF dropping 0.20% to hit 0.9171.

Earlier in the day, the Swiss National bank said that its foreign currency reserves fell to CHF224.9 billion in February from CHF229.4 billion the previous month.

The data came after a report showing that the Swiss unemployment rate held steady at 3.1%for the third consecutive month in February.

The greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD losing 0.27% to hit 0.9992,AUD/USD gaining 0.25% to hit 1.0579 and NZD/USD climbing 0.89% to hit 0.8196.

Official data showed earlier that Australia's economy expanded by a seasonally adjusted 0.4% in the last three months of 2011, disappointing expectations for a 0.7% increase.

In Canada, official data showed that building permits posted the steepest decline in eight months in February, dropping 12.3%, significantly more than expectations for a 2.3% decline and reversing all of the previous month's downwardly revised 10.5% gain.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies traded down 0.15% to hit 79.78.

Also Wednesday, official data showed that U.S. non-farm productivity advanced more than initially expected in the final three months of 2011, while unit labor costs jumped more-than-expected.




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