Following the release of data on U.S. job market which showed that employers shared more than expected jobs in March, the U.S. Dollar fell against major currencies. The data released showed that the economy lost about 80,000 jobs, the largest monthly decline in five years. This is the third consecutive job loss which confirms investors’ fears that the U.S. economy is in recession.
Although investors were expecting bad news about the U.S. job market, the extent of the job cut in the words of Greg Salvaggio of Tempos Consulting in Washington, “the jobs data was horrible.” However, he believes that investors have already priced in the expected job cuts and other negatives of the U.S. economy. Some analysts are of the opinion that the U.S. Dollar may finally be reaching a bottom.
In late trading on Friday, April 4, 2008 in New York, the Euro gained 3% on the U.S. Dollar to close at $1.5728 after rising to $1.5774. The U.S. Dollar fell to 101.58 Yen, a decline of 7%, and fell to 1.0060 Swiss Franc, a decline of 4%.
Investors believe that the European Central Bank will hold interest rates steady at 4% until inflation concerns in the Euro Zone reduces.
