by Herbert Rush
NEW YORK, Aug. 4 (Reuters) – A slowdown in U.S. job growth in July prompted hopes of a soft landing for the economy, but the dollar weakened on Friday as higher wages suggested the Federal Reserve may need to keep rates on hold for longer. It fell, losing almost all of its gains for the week.
US economy less work added than expected last month. However, strong wage growth and a fall in the unemployment rate to 3.5% suggest that the labor market continues to tighten.
Nonfarm payrolls rose by 187,000 last month, according to a Labor Department household survey, down from a Reuters poll of economists who expected an increase of 200,000.
Downward revision Employment gains in May and June suggested a slowdown in labor demand after the Fed’s big rate hike. However, with 1.6 vacancies per unemployed person, the suppression of hiring may indicate that firms are unable to find workers.
Mark Chandler, chief market strategist at Bannockburn Global Forex in New York, said the weaker-than-expected jobs report put a halt to the rise in Treasury yields this week and the recent rally in the dollar.
“There is a short squeeze in foreign currencies, and a sharp drop in interest rates is driving the liquidation of dollar longs,” he said. “The dollar correction is almost over.”
chandler then said This week’s consumer price index (CPI) report could show inflation rising year-on-year for the first time since June 2022.
Cathy Lien, editor-in-chief of New York’s 60 Second Investor magazine, said the market will see explosive numbers following private payroll figures released earlier this week and still-low unemployment claims.
“A soft landing is still possible in the worst case,” Rian said. “But all of today’s data leaves the door open for further rate hikes by the Federal Reserve.”
dollar index = USDThe dollar, the benchmark of the US currency against the country’s six currencies, fell 0.4 percent on Thursday after rising to 102.84, its highest since July 7. The fall was the biggest one-day drop for the dollar in three weeks.
Marvin Law, senior global macro strategist at State Street in Boston, said the U.S. labor market is heading in the right direction.
“Like a lot of recent data, there are advantages for both bulls and bears,” he said.
When job growth slows, the economy will “magically grow to 100,000 to 120,000 (job) “How many per month Fed Chairman Jerome Powell wants,” Lowe said.
But “wages have risen. Average hourly earnings are now 4.4% year-on-year, which is still inconsistent with the Fed’s 2% target.”
EUR euro = rose 0.55% to $1.1004 and the Japanese Yen rose 0.51% to $141.81.
Yields on long-term U.S. Treasury bonds hit a nine-month high on Thursday on the back of strong supply and data showing a more resilient labor market. we/
The yen is sensitive to rising US yields as the Bank of Japan keeps local interest rates in check. Traders are trying to gauge how quickly and by how much yields will rise after the Bank of Japan’s surprise monetary policy adjustment last week. Japan/
Australian dollar rises on weaker dollar plus China’s end of anti-dumping and anti-subsidy measures tariff On importing Australian barley as trading partners mend tensions. Australian dollar/
The Australian dollar gained 0.18% against the US dollar to $0.656.
The Swiss franc, the G10 currency that gained the most against the dollar this year, turned lower on the jobs report.dollar Swiss Franc = Against the franc, it fell 0.11%.
sterling British Pound = It ended the day at $1.2742, up 0.23%.
Currency bid prices at 4:00 PM ET (2000 GMT)
explanation
Rick
last
US ends previous session
Rate of change
YTD percent change
high bid
low bid
dollar index
= USD
102.0200
102.4500
-0.40%
-1.420%
+102.6200
+101.7300
euro/dollar
Euro = EBS
$1.1006
$1.0950
+0.52%
+2.72%
+$1.1042
+$1.0935
dollar/yen
JPY=EBS
141.8100
142.5200
-0.49%
+8.17%
+142.8750
+141.5500
euro/yen
Euro Yen =
156.07
156.04
+0.02%
+11.24%
+156.6300
+155.9100
dollar/switzerland
CHF=EBS
0.8731
0.8742
-0.09%
-5.54%
+0.8782
+0.8700
sterling/dollar
GBP=D3
$1.2743
$1.2709
+0.26%
+5.37%
+$1.2792
+$1.2689
dollar/canada
CAD=D3
1.3384
1.3353
+0.25%
-1.20%
+1.3394
+1.3320
Australia/Dollar
Australian dollar = D3
$0.6566
$0.6549
+0.25%
-3.68%
+$0.6609
+$0.6542
Euro/Switzerland
euro franc =
0.9608
0.9570
+0.40%
-2.90%
+0.9623
+0.9570
euro/pound
EURGBP=
0.8635
0.8613
+0.26%
-2.36%
+0.8647
+0.8602
New Zealand Dollar/Dollar
NZD=D3
$0.6091
$0.6077
+0.21%
-4.09%
+$0.6133
+$0.6072
dollar/norway
NOK=D3
10.1360
10.2440
-1.26%
+3.07%
+10.2380
+10.0850
Euro/Norway
Euroknock =
November 1578
11.2221
-0.57%
+6.33%
+11.2469
+11.1264
dollar/sweden
SEK=
10.5784
10.6988
-0.45%
+1.63%
+10.7203
+10.5370
Euro/Sweden
EURSEK=
11.6424
11.6945
-0.45%
+4.42%
+11.7325
+11.6290
world exchange rates https://tmsnrt.rs/2RBWI5E
US wage growth https://tmsnrt.rs/3OJs6PQ
(Reporting by Herbert Rush; Editing by Tomasz Yanowski, Deepa Babington, Richard Chan, Cynthia Osterman)
((herb.lash@thomsonreuters.com; 1-646-223-6019; Reuters messaging: herb.lash.reuters.com@reuters.net))
The views and opinions expressed herein are those of the authors and do not necessarily reflect those of Nasdaq, Inc.
