Dollar Losing Ground Ahead Of Jobs Report

The dollar is declining against all of its major rivals Thursday afternoon. Traders were met with a slew of U.S. economic data this morning, due to yesterday's day of mourning in honor of former President George H.W. Bush. The weaker than expected private sector employment report has traders concerned ahead of tomorrow's all important jobs report.

Private sector employment in the U.S. increased by less than expected in the month of November, according to a report released by payroll processor ADP on Thursday. ADP said private sector employment climbed by 179,000 jobs in November after jumping by a downwardly revised 225,000 jobs in October.

Economists had expected an increase of about 195,000 jobs compared to the addition of 227,000 jobs originally reported for the previous month.

First-time claims for U.S. unemployment benefits edged down by less than expected in the week ended December 1st, the Labor Department revealed in a report released on Thursday. The report said initial jobless claims slipped to 231,000, a decrease of 4,000 from the previous week's revised level of 235,000.

Economists had expected jobless claims to dip to 225,000 from the 234,000 originally reported for the previous week.

Reflecting a modest increase in the value of imports and a slight decrease in the value of exports, a report released by the Commerce Department on Thursday showed the U.S. trade deficit widened by more than expected in the month of October.

The Commerce Department said the trade deficit widened to $55.5 billion in October from a revised $54.6 billion in September. Economists had expected the trade deficit to widen to $55.0 billion from the $54.0 billion originally reported for the previous month.

Revised data released by the Labor Department on Thursday showed labor productivity in the U.S. increased by slightly more than initially estimated in the third quarter. The report also said unit labor costs rebounded by less than previously estimated.

The Labor Department said productivity surged up by 2.3 percent in the third quarter compared to the previously reported 2.2 percent spike. The upward revision to the pace of productivity growth matched economist estimates.

Meanwhile, the report said unit labor costs climbed by 0.9 percent in third quarter compared to the 1.2 percent jump previously reported. Economists had expected the increase in unit labor costs to be downwardly revised to 1.1 percent.

Growth in U.S. service sector activity unexpectedly accelerated in the month of November, according to a report released by the Institute for Supply Management on Thursday.

The ISM said its non-manufacturing index crept up to 60.7 in November after pulling back to 60.3 in October, with a reading above 50 indicating service sector growth. Economists had expected the index to dip to 59.2.

A report released by the Commerce Department on Thursday showed a steep drop in new orders for U.S. manufactured goods in the month of October. The Commerce Department said factory orders tumbled by 2.1 percent in October after rising by a downwardly revised 0.2 percent in September.

Economists had expected factory orders to slump by 2.0 percent compared to the 0.7 percent increase originally reported for the previous month.

The dollar has dropped to around $1.1390 against the Euro Thursday afternoon, from an early high of $1.1320.

Germany's manufacturing orders increased for a third straight month in October, defying expectations for a decline, led by strong foreign demand despite the global trade uncertainties. Factory orders grew 0.3 percent from September, preliminary data from the Federal Statistical Office showed on Thursday, while economists' had forecast a 0.4 percent fall.

The buck has fallen to around $1.2790 against the pound sterling this afternoon, from an early high of $1.2698.

The greenback reached an early high of Y113.1159 against the Japanese Yen Thursday, but has since retreated to around Y112.490.

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