Treasury - Daily Forex for day 04.01.2005

The U.S. dollar extended its recovery versus its major rivals on Monday due mostly to continued profit-taking. The Institute for Supply Management reported its manufacturing index for December rose to higher-than-expected 58.6 from 57.8 in November. However, the employment component of the ISM's index slumped to a 14-month low of 52.7 in December from 57.6 in November, causing a slowdown of the dollar's appreciation. The weak jobs reading suggested that the December U.S. employment report due Friday might come below forecasts. The market expects U.S. non-farm payrolls figure to show an advance of 175,000 in December after November's 112,000 rise.

With a public holiday in the United Kingdom, the trading on the Czech market was quiet on Monday. The crown closed flat on the day at around 30.400 per euro. The government report that the 2004 central state budget deficit was just 93.5 billion crowns, far below the target of 115.7 billion, had little impact on the currency.