Market participants were wary after the release of U.S. labour market data on Thursday, indicating a mixed picture of the strength of the jobs market. A report from the ADP payroll processing company showed that non-farm private employment increased by 137,000 in May, slightly lower than expectations for a 175,000 increase.
Another report from the U.S. Department of Labor indicated that the number of people applying for unemployment benefits in the week ending May 28th decreased by 1,000 to 267,000 from the previous week’s 268,000 figure. Economists had expected initial jobless claims to increase by 2,000 to 270,000.
The USD/JPY pair slipped 0.13% to 108.73, the lowest level since the 16th of May. The yen remained underpinned after the Japanese Prime Minister revealed on Tuesday that he was intending the delay a planned sales tax raise amid persistent weakness in the country’s economy. He also said that he was planning to employ a fiscal stimulus package later in 2016.
The EUR/USD pair was slightly changed at 1.1153. On Thursday, the European Central Bank announced its decision to leave the benchmark interest rate unchanged at 0.0%, in accordance with economists’ expectations. Moreover, the central bank upgraded its growth forecast for 2016 up to 1.6% from 1.4%, but left its forecasts for 2017 and 2018 unchanged.
In a press conference shortly after the decision, the ECB President Mario Draghi stressed that inflation in the eurozone is likely to remain low or even negative for some time.
Elsewhere, the Australian dollar extended its gains, following the release of a strong services survey. The AUD/USD pair inched up 0.11% at 0.7237. The AIG services index climbed to 51.1 in May from 49.7 a month before, pushing the indicator into positive territory. Capacity utilization edged lower last month and price measures remained subdued, signaling a lack of inflation pressure.
The U.S. dollar index, which tracks the greenback’s performance against six other major counterparts, was steady at 95.53.