Dollar sentiment improves despite weak jobs report

Economic data were positive on balance during the week. The ISM’s nonmanufacturing index in September hit a 12-year high of 59.8. A number above 50 indicates expansion. Factory orders for August rebounded to 1.2% from a 3.3% drop in July, suggesting a likely acceleration In US GDP growth in fourth quarter as business investment rises. Congress passed a $4.1 trillion budget, which is considered as a first step to enacting US tax code overhaul. A weaker jobs report was expected due to hurricanes’ impact but the 33 thousand contraction Nonfarm payrolls was a negative surprise. On the positive side the earnings rose more than expected, boosting chances of another rate hike in December. As is evident from the Sentiment table, sentiment improved for euro and Canadian dollar. And the euro, Canadian and Australian dollars together with British Pound remain the four major currencies held net long against the US dollar.