The US dollar on Friday fell to its lowest in more than two months after US jobs data for last month came in well below expectations, putting a damper on hopes that a roaring economic recovery would lead to higher rates any time soon.
Nonfarm payrolls last month increased by only 266,000 jobs after rising by 770,000 in March, the US Department of Labor said in its closely watched employment report on Friday.
Economists polled by Reuters had forecast payrolls advancing by 978,000 jobs.
Photo: Reuters
The US dollar was down 0.34 percent at 90.561 against a basket of major currencies, having dropped as low as 90.338, its lowest since Feb. 26, following the data.
“The dollar is really getting spanked this morning,” said Boris Schlossberg, managing director of FX strategy at BK Asset Management.
“The number was so out of consensus, that I think the market expectation of super-high rates and a squeeze on inflation is going to go down by the wayside, and that obviously means more liquidity from the [US Federal Reserve],” Schlossberg said.
It also means that US interest rates would stay at ultra-low levels for quite a while, maintaining pressure on the US dollar, he added.
The euro was up 0.44 percent against the greenback at US$1.21140 and the British pound was up 0.3 percent at US$1.3933.
“This is only one report, but this is changing many traders’ thinking on how this recovery is unfolding,” Oanda Corp senior market analyst Edward Moya said.
Elsewhere, China’s exports unexpectedly accelerated last month and import growth hit a decade high, helping to push the yuan and Asian stocks higher.
China’s yuan was at a more than two-month high versus the US dollar, helped by the strong trade data and softer US dollar.
The MSCI Emerging Market Currency Index hit a record high of 1732.79 on Friday, lifted by gains in the Chinese yuan.
The New Taiwan dollar rose against the greenback on Friday, gaining NT$0.082 to close at NT$27.908, up 0.15 percent on the week.
The Canadian dollar was up 0.27 percent at C$1.2185 to the US dollar, having surged on Thursday to its strongest in more than three years.
The Australian dollar was up 0.19 percent versus the US dollar, at A$0.77995, more than recouping losses from earlier in the session.
The Australian dollar has been supported by a strong rally in the prices of Australia’s top export earner, iron ore.
“We expect the likes of [the Australian dollar, Canadian dollar and Norwegian krone] to remain well supported with the backdrop for positive optimism over global growth still quite favorable,” MUFG head of research Derek Halpenny wrote in a note.
In cryptocurrencies, ether rose 0.51 percent to US$3,507.92, having hit an all-time high on Thursday.
Bitcoin was up 1.4 percent, at US$57,237.60.
Additional reporting by CNA, with staff writer
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