Europe Asia News

The U.S. dollar had recovered earlier in the week, with the Dollar Index, which tracks the value of the dollar against a basket of six other currencies, rising to 96.7, close to the levels seen at the end of January.

In a note released by ING analysts on Tuesday, they said, “The Dollar Index may hover in the range of 96.50-97.50 over the next few days and is likely to be influenced by labor market data.”

The U.S. economy is expected to have added 70,000 jobs last month after a 50,000 increase in December, with the unemployment rate likely remaining at 4.4%.

Analysts say a weaker-than-expected figure could further negatively impact risk sentiment, especially after retail sales data released on Tuesday showed an unexpected slowdown and rising pressure on low- and middle-income consumers.

The dollar was also negatively affected by news that Chinese regulators had advised financial institutions to limit their holdings of U.S. Treasury bonds, raising concerns about external demand for U.S. assets.

This move reinforced the view that investors are shifting from dollar-denominated assets to safe havens and emerging markets.

On the other hand, Commerce Secretary Howard Lutnick said Tuesday that the dollar was artificially raised by other countries wishing to increase exports to the U.S.