The dollar rose against the euro Monday, as investors took profits on recent gains in the single currency ahead of key U.S. economic data due at the end of the week.
On Monday afternoon in New York, the euro was down 0.5% against the dollar to $1.1143. The single currency is up more than 5% against the dollar from its April lows, spurred by a spate of weak data in the U.S. and flickering signs that the European Central Bank's massive stimulus program may be helping boost Europe's beleaguered economy.
The euro's rally is set for a major test this week, when the U.S. reports monthly nonfarm payrolls on Friday. A weak reading in the widely followed employment indicator would bolster the case for the Federal Reserve to delay its interest rate increases, a move that is expected to boost the euro while further weighing on the U.S. currency.
Recent U.S. data "has been soft, and we're going to go on waiting for signs of economic spring," said Kit Juckes, a strategist at Societe Generale, in a note to clients. "This week will be all about Friday's payroll data."
The dollar was up unchanged against the yen at JPY120.13. The pound was down 0.2% at $1.5120. The Wall Street Journal Dollar Index, which measures the dollar against a basket of 16 currencies, was up 0.1% at 85.87.
In emerging markets, Thailand's baht slumped to its lowest level in five years against the U.S. dollar, as the Bank of Thailand steps up currency-weakening measures in hopes of propping up the faltering economy.
The baht was trading at a six-month high just two weeks ago, but since then it has fallen for eight consecutive trading days and into negative territory for the year. Midday Monday in New York, the dollar was buying 33.35 baht, up from 33.24 late Friday.
Much of the drop follows the Thai central bank's surprise decision last Wednesday to cut interest rates for a second time in as many months, lessening the burden on struggling borrowers and making the currency less attractive by reducing yields.
A relaxation of capital controls a day later also weighed on the baht by making it easier for cash to flow out of the country. Among other changes, the relaxation means residents can now hold more in foreign-currency deposits in local banks and buy overseas property at a higher value.
Thailand's economy barely registered growth last year, at 0.7%, down from 2.9% a year earlier, according to official figures.
(END) Dow Jones Newswires
May 04, 2015 17:08 ET (21:08 GMT)
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