Australian jobs, U.S. data, Bank of England meetings share focus By Deborah Levine and William L. Watts, MarketWatch NEW YORK (MarketWatch) — The euro fell against the dollar on Thursday after European Central Bank President Jean-Claude Trichet began his monthly news conference, saying the latest rate increase will anchor inflation expectations. Separately, the Australian dollar rallied on the back of strong employment data. The euro EURUSD -0.31% fell to $1.4261 from $1.4303 in late New York trading on Wednesday, when the 17-nation shared currency was pressured after Moody’s Investors Service’s downgrade of Portugal triggered fresh concerns about European sovereign-debt issues. Read more about European sovereign debt worries. The dollar index DXY +0.11% , which measures the U.S. unit’s value against a basket of six major currencies, rose to 75.235 from 75.088 late in New York. The ECB raised its key lending rate to 1.5% from 1.25% earlier, as had been widely predicted. Read ECB rate decision preview Trichet also noted a continuation of upside risks to price stability. The ECB’s primary policy goal is to keep inflation low. The question-and-answer session of his monthly news conference was expected to be dominated by questions surrounding the euro-zone’s long-running debt crisis and efforts by banks and European officials to fashion some type of rollover of Greek-government debt without triggering a default designation from major credit-rating companies. Clearing hurdles Credit Agricole strategists wrote in a note to clients that the passage of Greece’s austerity package last week “cleared the last hurdles” for this rate hike, and that despite a general weakness in recent data on economic activity, price-inflation risks have remained on the upside. “Beyond the hike, the market will focus on the tone of the statement and likelihood of the next move,” they said. Many currency strategists expect Trichet to deter expectations of another rate hike soon to see whether the sovereign-debt problems still plaguing Greece spread to other countries. The dollar extended gains against the euro and Japanese yen after a pair of positive reports on the U.S. jobs market, from ADP and the government. They come a day before the Labor Department’s eagerly awaited monthly nonfarm payrolls report for June. Read story on ADP. The ADP report “will build a positive tone for the dollar ahead of Friday’s official government report, which is a broader reading of the health of the economy,” said Andrew Wilkinson, senior market analyst at Interactive Brokers. Against the Japanese yen, the dollar USDJPY +0.49% bought ¥81.40, up from ¥80.94 in New York. Australian job gains The Australian dollar climbed against the greenback after official data showed a sharp increase in full-time employment. Read full story on Australia’s employment data. The Australian unit AUDUSD +0.54% traded at $1.0750, rising off the day’s low of $1.0684. But the dollar was trading higher against the British pound, which stayed under pressure after the Bank of England left its policy rate unchanged, as expected. The pound GBPUSD -0.13% fell to $1.5991 compared to $1.5993 late Wednesday. Deborah Levine is a MarketWatch reporter, based in New York. William L. Watts is a reporter for MarketWatch in Frankfurt. Varahabhotla Phani Kumar in Hong Kong contributed to this report.

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