Euro under pressure after weak jobless data in the euro zone
The dollar extended gains on Monday, although is not so aggressive. Pound/dollar fell to 1.6307 at the end of the Asian session, but rebounded later to 1.64. On Friday concerns over economic stabilisation pace were stirred up by executive director of the Bank of England Fisher, who announced that if the supply of credit remains low, economy could suffer from it. The announcement reflected house market data. British house price in May recorded 15th in a row falling on month-over-month basis, shrinking by 0.7% that in its turn led to index dropping at 14.1% annual rate.
The euro is traded much worse than sterling. Weak labour market condition data intensified negative sentiments against the European common currency and revived concerns that the European Central Bank could undertake further rate cut. The number of workplaces in 16 states in the euro zone for 1st quarter 2009 reduced by 1.2 mln. This reduction was the most significant from the beginning of statistics since 1991. According to Eurostat data the number of persons employed in the euro area fell by 0.8% in the first quarter. At the same time the reduction was showed already 3 quarters in a row and reduction pace was distinctly advanced. In the forth quarter of 2008 the employment number was contracted by 0.4% against that of the previous quarter, at the same time in the third quarter the data dropped by 0.2%. Nevertheless euro/dollar are holding above the support level at 1.38, which breakdown could intensify bearish sentiment and extend losses to the level of 1.3550-1.3430. The single currency against sterling renewed the many-month low, falling to 0.8761 with further declining risk.
