Treasury - Daily Forex for day 03.06.2006

The dollar shed some gains against the euro made on Wednesday on hawkish minutes from the Federal Reserve's May meeting as U.S. manufacturing data came in below expectations. The Institute for Supply Management's index of manufacturing activity fell to 54.4 in May, its lowest since August 2005. Analysts had expected the activity to drop to 55.5 from April's 57.3. The dollar was also undermined by a warning from the European Central Bank saying that global imbalances could lead to sharp depreciation of the dollar. The market's focus today is on a key U.S. employment report for May. Non-farm payrolls are expected to accelerate to 175,000 from 138,000 in April.

The crown remained locked in a narrow band yesterday, trading little changed on the day against the euro, near the 28.25 level.