Cracks in the Labor Market Could Halt the Dollar's Rally

Odaily News Rania Gule, an analyst at brokerage firm XS.com, stated that unless Friday's non-farm payroll report exceeds expectations, the current rally in the US dollar may be limited and only temporary. In her report, she noted that the dollar is in a "vulnerable position," and any further signs of weakness in the labor market could push it lower. She believes that despite recent weak data, the dollar has still seen slight gains, indicating that investors are more inclined to hold their positions and wait for clarity before the outlook becomes clear. This behavior reflects a temporary balance between concerns about a US economic slowdown and the dollar's safe-haven role, a balance that could "quickly break with any unexpected moves in labor market data." (Jin10)