Dollar Fails To Hold Gains, Turns Weak Against Major Counterparts

(RTTNews) - The U.S. dollar firmed against its major rivals Thursday morning after data showed the nation's private sector employment surged much more than expected in June. However, the currency quickly retreated and shed ground against most of the major counterparts.

Data from payroll processor ADP showed that private sector employment spiked by 497,000 jobs in June after jumping by a downwardly revised 267,000 jobs in May.

Economists had expected private sector employment to increase by 228,000 jobs compared to the addition of 278,000 jobs originally reported for the previous month.

A report from the Labor Department showed initial jobless claims rose to 248,000 in the week ended July 1st, an increase of 12,000 from the previous week's revised level of 236,000.

Economists had expected jobless claims to climb to 245,000 from the 239,000 originally reported for the previous week.

The U.S. Labor Department is scheduled to release jobs data on Friday. Economists expect nonfarm payrolls to increase by 225,000 in June and the unemployment rate is forecast to fall to 3.6%.

The Institute for Supply Management released a report showing the pace of growth in the service sector accelerated by much more than expected in June.

The ISM said its services PMI climbed to 53.9 in June from 50.3 in May, with a reading above 50 indicating growth in the sector. Economists had expected the index to inch up to 51.0.

The dollar index climbed to 103.57 from a low of 102.92, but pared gains subsequently and dropped to 103.14, down nearly 0.25% from the previous close.

Against the Euro, the dollar weakened to 1.0892 after having firmed to around 1.0835 earlier in the day.

The dollar eased to 1.2740 against Pound Sterling from 1.2704.

Against the Japanese currency, the dollar weakened to 144.08 yen from previous close of 144.66 yen.

The dollar is trading at 0.6625 against the Aussie, firming from 0.6657. Against Swiss franc, the dollar has dropped to CHF 0.8952 from CHF 0.8987, while against the Loonie, it is up, fetching C$1.3373 a unit.