RTTNews - The dollar went back on the defensive on Wednesday, falling further against the surging yen while extending its run of choppy trading against the euro and sterling.
Traders weighed a slew of economic data, including a prelude to Friday's pivotal jobs report. With no clear indication as the health of the domestic or global economy, the dollar has struggled to sustain any positive momentum versus the euro of late.
In attempting to fight back from 2009 lows reached a month ago, the dollar reached a 2-week high yesterday, but quickly reversed course to trade near 1.4300 on Wednesday.
The buck slipped back to 1.6300 versus the sterling, dropping to 1.6300 from a 7-week high of 1.6113.
Meanwhile, the greenback continued a dismal stretch versus the yen, slipping to a 7-week low of 92.20. A move to 87 would take the dollar to its lowest level in years against its Japanese counterpart.
Its been the yen, rather than the dollar, that has been the latest beneficiary of increased risk aversion.
Members of the Federal Open Market Committee are more confident that the economic downturn is ending and that growth is likely to resume in the second half of the year, according to the minutes of the August FOMC meeting released on Wednesday.
The committee members said that their projections for the second half of 2009 and for subsequent years had not changed appreciably since the June meeting, except that they now saw smaller downside risks.
In other economic news, private sector employment fell by much more than expected in the month of August, according to a report released by Automatic Data Processing, Inc. (ADP) on Wednesday, although the report still showed a slowdown in the pace of job losses.
ADP said that non-farm private employment fell by 298,000 jobs in August following a revised decrease of 360,000 jobs in July.
The most important economic report of the week will be the Labor Department's non-farm payroll employment report for August, which is due out on Friday.
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