The dollar dipped slightly on Friday as investors awaited the monthly job report from the U.S. Labor Department. The report, expected early this morning, will give market players insight into whether the economy will bounce back after a disappointing second quarter.
The U.S. dollar remained flat against a basket of currencies this week after falling 2% last week. The greenback was hurt by a poor growth report, which was weaker than expected.
The dollar edged down 0.1% on Friday to 95.660 after touching a low of 95.003 earlier in the week.
The British pound, meanwhile, climbed 0.2% to $1.3137 after the Bank of England announced a larger-than-expected stimulus package.
Economists expect non-farm payrolls to have increased by 180,000 in July.
If the job report shows strong job growth, it may revive the case for the Federal Reserve to raise rates in the near future. Investors had largely dismissed the idea of the Fed raising rates before the year’s end in the wake of Britain’s vote to leave the European Union.
According to CMD FedWatch, markets are betting on a 32% chance of a rate hike before the year ends.
The payroll data is in particular focus on Friday because of the poor economic growth report released last week, which not only disappointed investors, but also repriced rate expectations.
Market players are now looking for signs of whether the world’s largest economy is really in a poor state, or if things will improve in the third quarter of the year.
The dollar slipped against the yen, falling 0.2% to 101.05, not far off of its three-week low of 100.68 on Tuesday.
In other currency news, the Swiss National Bank’s foreign exchange reserves climbed to a historic high in July. The data highlights the bank’s challenge of keeping a lid on gains in the Swiss franc. The news pushed the franc down 0.3% against the euro to 1.0859.