The US dollar on Friday fell to a fresh two-and-a-half-year low, as investors shrugged off a US non-farm payrolls report that badly missed expectations for last month and focused on a flurry of positive vaccine news.
Upbeat announcements on vaccinations have helped drive a rally in riskier currencies, while actions taken by the US Federal Reserve have weakened the greenback.
Data showed that US non-farm payrolls increased by 245,000 jobs last month after rising by 610,000 in October. That was the smallest gain since the jobs recovery started in May.
However, “the vaccines, the restart of talks about stimulus and the new administration, and a less confrontational international background, are still going to be the themes that drive the market,” said Marvin Loh, senior global macro strategist at State Street Global Markets in Boston.
The US dollar index fell 0.1 percent to 90.81, after earlier falling to 90.471, the lowest in more than two-and-a-half years. On the week, it was down 1.07 percent.
“It has been another bad week for the US dollar,” analysts at Mitsubishi UFJ Financial Group said in a note. “It will encourage speculators to rebuild short US dollar positions which have been pared in recent months.”
The euro has been one of the biggest winners from recent US dollar weakness, breaking decisively above US$1.20 this week
The euro hit a two-and-a-half-year high of US$1.2177, just above the previous day’s benchmark, but closed at US$1.2121.
The New Taiwan dollar rose against the US dollar on Friday, gaining NT$0.147 to close at NT$28.521, a 1 percent increase from a week earlier.
Ulas Akincilar, head of trading at INFINOX, said that despite the weaker-than-expected US employment data, it was a “finely balanced jobs report.”
“The calculation is that the slowing jobs market will spur US lawmakers into agreeing a fiscal stimulus to match the Fed’s monetary support, and yet the slowdown is not so bad as to send investors running for the hills,” he said.
Additional reporting by staff writer
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