Soft labor market figures weigh on the USD, with traders eyeing today’s nonfarm payrolls report for further direction.
The Dollar Index retreated after lower-than-expected ADP employment and US jobless claims data signaled a cooling labor market. The ADP report showed fewer private-sector jobs added than forecast, while initial jobless claims rose, reinforcing concerns about economic momentum.
Prior to this, the Dollar Index had hovered near 100, with markets pricing in potential Federal Reserve rate cuts later this year. Analysts now await today’s nonfarm payrolls (NFP) report, where a weaker-than-expected print could push the index further down, delaying a break above 100.
US Treasury and German bund yields also eased, reflecting shifting expectations for monetary policy amid softer economic data.