The euro fades as the dollar rises when we talk about promising jobs in the United States

LONDON (Reuters) – The brief recovery in the euro ended Friday with political uncertainty and the threat of economic decline in Europe that is pulling the currency against the dollar.

Sporadic signs of a recovery in economic activity in Europe have not helped the euro break out of the range of 1.11 to 1.14 USD from which it is stuck.

Manufacturing surveys released Thursday revealed another contraction in April. The threat of US tariffs on European automobiles and the upcoming European elections also weighed on the currency, badysts said.

The dollar has risen slightly since Federal Reserve Chairman Jerome Powell downplayed the recent slowdown in inflation and said he saw no reason to lower interest rates.

The euro was down 0.1% to $ 1.1722, after falling $ 1.1219 a night, but was even stronger over the week.

The dollar index reached 97,844 against a basket of currencies, up from 97,149 at the start of the week. Some traders have speculated that the dollar would still gain if US employment data released on Friday were better than expected.

"Selling in May and Getting There" With the strong dollar at the moment and emerging markets performing poorly, current employment data could give a little more weight to this adage of the market, "said Chris Turner, head of FX strategy at ING in London.

The week was calm for the main currencies. Volatility was at a multi-year low and liquidity was limited with Japan and China on extended vacations.

The pound sterling gained 1.3% while hopes of a breakthrough in the Brexit negotiations were timid.

The Australian and New Zealand dollars have fallen under the effect of speculation, the two countries will reduce interest rates next week.

The Reserve Bank of Australia meets on May 7 and the Reserve Bank of New Zealand one day later. Everyone can reduce rates after low inflation reports.

The money markets now predict a 49% probability that the Fed will cut rates this year, compared to 61% before Powell's remarks.

Pricing may change again after the publication of the US Jobs Report for April. According to forecasts, the wage bill is expected to increase by 185,000 with an unemployment rate of 3.8%.