LONDON: The dollar languished near its lowest levels in over two months against a basket of major currencies on Thursday, under renewed pressure from disappointing U.S. data, while a further spike in German bond yields supported the euro.
Figures on Wednesday showed U.S. private sector employers in April hired the fewest workers in more than a year, raising a red flag for nonfarm payrolls due on Friday.
The dollar index slid as far as 93.882 – a low last seen in mid-February – and last stood at 94.207. It has fallen more than 6 percent from a 12-year peak of 100.39 set in March.
Dollar bulls are looking for evidence that the U.S. economy has bounced back following a very soft patch in the first quarter.
“The market is starting to question whether the Federal Reserve can raise rates under current low economic growth. If the upcoming payroll data is weak, we could see clearer weakness in the dollar,” said Minori Uchida, chief FX strategist at Bank of Tokyo-Mitsubishi UFJ in Tokyo.
The euro jumped to a two-month high of $1.1371, continuing to pull away from a 12-year trough of $1.0457 plumbed in March. It last traded at $1.1344.
