After six full months of consecutive declines – a rare rough patch – the US dollar is seeing a little support.
The dollar index, which measures the greenback against a basket of major currencies, 0.2 per cent higher in early trading to 92.809.
The dollar’s pick-up comes after the currency fell in the final session of August, wrapping up six straight months of declines – the longest losing streak in 14 years.
The release of non-farm payroll data early this afternoon (London time) comes at a critical moment in the broader monetary environment, with investors expecting a gradual reversal of an era of ultra-loose policy across global central banks.
Economists expect US hiring cooled in August with forecasts of 178,000 jobs created in the month.
“US data overall have been very strong recently. Investors have ignored these data because the inflation numbers are surprising to the downside and several FOMC participants have pointed to rising inflation as a prerequisite for further hikes,” said Steven Englander at Rafiki Capital.
He argues that, in the longer term, the “fundamentals are better than the market is now pricing”.