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Forex - Dollar Struggles for Direction Amid Mixed U.S. Data

Published 2018-09-06, 01:10 p/m
Updated 2018-09-06, 04:47 p/m
The dollar traded flat on Thursday.

Investing.com - The dollar was flat against its rivals Thursday as mixed U.S. economic data did little to determine direction, while fears that the United States could impose tariffs on China also weighed.

The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.01% to 95.06.

A deluge of mixed economic U.S. data showed services activity remained robust, factory orders were off the pace and weakness in the private labor market, leaving investors with little conviction to back the dollar.

On the labor market front, private payrolls grew by 163,000 in August, a decline from the 217,000 in July, according to a report released Wednesday by ADP and Moody's Analytics. That missed economists’ forecast of 188,000.

The weaker ADP print comes a day ahead of the all-important nonfarm payrolls report, with economists' expecting that the U.S. economy churned out about 191,000 jobs in August.

The Commerce Department, meanwhile, said factory orders slipped 0.8% in July month, missing economists' forecasts for a 0.6% decline.

ISM nonmanufacturing data for August showed an uptick to 58.5, beating expectations for a reading of 57.0. The services sector is critical component of the U.S. economy, accounting for roughly 80% of U.S. private-sector GDP.

The dollar was also kept in check by a both sterling and yen strength as the latter attracted safe-haven demand on concerns the U.S.-China trade war could intensify.

Trump could impose levies on $200 billion more of Chinese imports on Thursday when a public comment period on the new tariffs ends.

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GBP/USD rose 0.24% to $1.2936, while USD/JPY fell 0.73% to Y110.72.

The Canadian dollar came under pressure as U.S.-Canada efforts to reach an agreement on a NAFTA revamp continued ahead of an Oct. 1, deadline. The oil-price-sensitive loonie was also weighed down by falling oil prices as large builds in U.S. product inventories offset a draw in crude stockpiles.

USD/CAD rose 0.22% to C$1.3207, while EUR/USD fell 0.08% to $1.1622.

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