Currency Briefing - what you need to know for Mon April 9, 2012

The US dollar has recovered slightly against the Singapore dollar and now sits at $1.26.

IG Markets Singapore said:

The Greenback had a pretty volatile week against major currencies last week as the QE3 on/off debate continues to rage. A mini rally was then followed by a fall as weaker-than-expected jobs data was released on Friday.

This non-farm payrolls data spooked traders as to the strength of the recovery in the US economy with many opting for the safe haven of the Yen.

This Singapore dollar had gained on the US dollar weakness as it dipped below $1.26. But the Greenback has recovered slightly against the local currency and now sits at $1.2629.

Most markets enjoyed a good Friday holiday last week so there could be a delayed reaction on the disappointing US employment numbers when markets reopen. It is likely to dampen sentiment for riskier currencies in Asia.

In Singapore traders are remaining cautious waiting for the Monetary Authority of Singapore’s semi-annual policy meeting this Friday, although no major shift from the gradual dollar appreciation stance is expected.

RBS meanwhile reported (for 6 April 2012 trading):

The softer-than-expected payrolls report was the highlight of the holiday-shortened session. USD/JPY dropped following the release and stayed around 81.50 for the rest of the session while the USD modestly lost ground versus the EUR and GBP.

The commodity dollar bloc weakened versus the USD but with equity futures closing 45 minutes after the payrolls release and other markets closed/closing early, we will likely have to wait until the post-holiday price action to see how market participants have digested the data.