Dollar’s rate is consolidated to 6 currencies on Forex after weak employment data in the United States

Dollar's rate on Friday stopped active growth versus a basket of six currencies. Bidding on the dollar’s index on Friday ended with reduction by 0.4% at 83.97.

Dollar’s rate began to consolidate against other currencies after the release of unexpectedly weak statistics on employment in August. Yield of negative macroeconomic data stopped the rapid growth of the dollar on the Forex.

Analysts of the Forex Broker Company "Forex Trend" told about the data published by the Ministry of Labour in the USA on Friday, on the 5th of September.

Increase of dollar could be continued

On Friday, on 5th of September, a report on the number of created jobs, excluding the agriculture sector of the United States, went much worse than economists' forecasts. However, investors believe that the dollar will probably be able to return to growth, as other macro indicators continue to point for active improvement of the American economy.

According to previously released data, the manufacturing sector of the USA grew by the most active pace in more than 3 years. It is also likely that the consolidation of the dollar has become an automatic reaction of investors to the output of weak statistics. However, the weak data of the August report did not worsen the prospects for greater growth of the American economy in the second half of 2014.

Within six months, the labor market has shown steady growth in the United States to create new jobs. In August, employment growth was the lowest in 2014. United States Department of Labor reported that the number of new jobs outside the agricultural sector in August increased by only 142 000. The data was adjusted to account for seasonal variations. The unemployment rate according to the household survey fell to 6.1% from the July level of 6.2%. During the year the unemployment rate fell to 1.1% from 7.2%. Economists had expected a decline in unemployment to 6.1%, and the growth of jobs at 225,000.

The July increase in the number of jobs to payrolls was raised to 212 000 from 209 000 However, the unexpectedly high June’s data reduced to 267 000 to 298 000. According to the averaged data, the number of jobs in the last 3 months in the United States increased by 207,000.

For 2014, employers in the United States have created an average 215,000 jobs a month. Such employment growth rates were the best since 1999, when the pace of hiring made an average of 265 thousand.

High rates of recovery of the labor market are supporting the economy and contribute to the growth of consumer confidence, causing an increase in costs. However, in recent years in the United States economy is experiencing a bumpy growth of these indices at scale employment growth. Proportion of the economically active population has dropped to the lowest level since the late 1970s, the level of 62.8%. In July, it rose slightly to 62.9%.

Despite the high growth of employment in the current year, official data contain virtually no evidence of growth in wages and return departures from the labor force during a recession workers. Average earnings in the private sector rose by 6 cents, compared to July, to 24.53 dollars, and by 2.1% on an annualized basis. The working week for six months was unchanged at 34.5 hours.

Economists analyze published data on payrolls for reducing the size of underutilized labor resources. The head of the Federal Reserve System (FRS) J.Yellen in Jackson Hole signaled a decline in unemployment surprisingly fast, considering that the number of under-utilized labor resources is reduced.

FRS keeps short-term interest rates near zero since December 2008 to stabilize the economy, which suffered after the collapse of the housing market caused by the financial crisis and recession. The Fed plans to complete the third program of bond purchases in October, and Fed officials believe that the rise in interest rates will begin in summer 2015. But the head of the Fed signaled that interest rates could rise sooner than currently anticipated, if it is stored more rapid progress in the labor market than planned, Fed.

The medium-term outlook for the dollar’s index on Forex

Traders of Masterforex-V Academy estimated 4-hour timeframe of dollar’s index since the 24th of July. On the chart is visible long-term growth and medium-term trends shown moving averages 233 (blue) and 55 (orange) periods. Given the "resistance" of price after weak labor market data in the United States is likely that the market is strong and has not responded to the negative statistics.

The next impulse wave of growth, shown in orange, near 81.35 and formed near the peak of the 7th of July, 2013 year 83, 97. 

In the medium term, more likely to continue the upward trend in the dollar after experiencing high near 83.97 and the psychologically important level of 84.00 to 83.48 area on the orange arrow.

Correction of the active growth of the dollar may start after experiencing the level of support near 83.55 and the price reduction of 82.82 area as indicated by a green arrow.

Traders of binary option chair in Masterforex-V World Academy http://www.masterforex-v.com/ recommend to open transactions buy to dollar’s index before the American session only on pullbacks prices down. Lifetime number of binary option is recommended for 1.5 hours.