Dollar Advances to One-Month High


The dollar rose to a one-month high versus the euro after a private report showed U.S. companies unexpectedly added jobs this month.

The greenback also gained as a decline in crude oil eased concern elevated fuel costs will erode consumer spending.

The dollar increased 0.2 percent to $1.5558 per euro at 8:39 a.m. in New York, from $1.5588 yesterday. It touched $1.5547, the strongest level since June 25. It may advance to $1.5460, Moran said. The U.S. currency was little changed at 108.15 yen, compared with 108.11. The euro fell 0.1 percent to 168.32 yen, from 168.53.

U.S. companies added 9,000 jobs in July after cutting a revised 77,000 positions the previous month, according to ADP Employer Services. The median forecast of 29 economists surveyed by Bloomberg News was for a reduction of 60,000.

Non-farm payrolls dropped by 75,000 this month following a decline of 62,000 in June, according to the median forecast in a separate Bloomberg survey. The Labor Department is scheduled to release its report Aug. 1.

Crude oil fell for a second day, declining 0.4 percent to $121.73 a barrel on the New York Mercantile Exchange. It has dropped 17 percent from the record of $147.27 set on July 11. The euro-dollar exchange rate and oil has had a correlation of 0.9 in the past year, according to Bloomberg calculations based on the correlation of their value changes. A reading of 1 would mean they moved in lockstep.

The Dollar Index, which tracks the greenback against the currencies of six U.S. trading partners, was at 73.376, compared with 73.309 yesterday, when it reached 73.428, the highest level since June 24.


TradingEconomics.com, Bloomberg
7/30/2008 6:34:49 AM