Forex – Dollar steady after North Korea missile test, euro dips

The dollar was steady against a basket of the other major currencies on Monday, holding above last week’s six-and-a-half month lows as markets shrugged off news of North Korea’s latest missile test.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was little changed at 97.36 by 07.45 GMT, well above last week’s low of 96.79, its lowest trough since November 9.

Investors were looking ahead to Friday’s U.S. employment report, which was expected to show that conditions in the labor market remain solid.

A strong U.S. jobs report would cement expectations for a rate hike by the Federal Reserve at its next meeting in June.

Data on Friday showed that the U.S. economy slowed less than initially thought in the first three months of the year. Gross domestic product grew at an annual rate of 1.2% in the three months to March, the Commerce Department said, up from an initial estimate of 0.7%.

It was still the weakest expansion since the first quarter of 2016, but economists think growth is likely to rebound sharply in the current quarter.

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