The U.S. dollar fell against most of its rivals on Friday after U.S. jobs data came in under expectations, fuelling uncertainty over the Federal Reserve’s next move.
Official data showed that the U.S. economy added 169,000 jobs in August, less than the expected 180,000 increase, after a downwardly revised 104,000 rise the previous month.
Despite the data, the official unemployment rate fell slightly to 7.3% in August, from 7.4% in July, as more people left the workforce. Analysts had expected the unemployment rate to remain unchanged.
EUR/USD gained 0.43% to 1.3176 at the close of the U.S. session.
The euro’s gains were limited after downbeat economic reports from Germany showed that German industrial production dropped 1.7% in July, compared to expectations for a 0.5% fall, after a downwardly revised 2% rise the previous month.
Germany’s trade surplus also narrowed unexpectedly to EUR14.5 billion in July, from an upwardly revised surplus of EUR15.8 billion the previous month. Analysts had expected the trade surplus to expand to EUR16.1 billion in July.
In the U.K. official data showed that manufacturing production rose 0.2% in July, confounding expectations for a 0.3% rise, after an upwardly revised 2% increase the previous month.
The U.K. trade deficit also widened to GBP9.85 billion in July, from a downwardly revised deficit of GBP8.17 billion the previous month. Analysts had expected the trade deficit to narrow to GBP8.15 billion in July.
Despite the data the pound strengthened against the dollar with GBP/USD rising 0.26% to 1.5630 after the similarly weak U.S. data.
In Australia the Aussie dollar went on a bit of tear with AUD/USD climbing 0.77% to 0.9172. AUD/USD is trading close to the key 0.9193 resistance level, a breach of which could signal a climb to around 0.9234 and 0.9258.
In Canada, the loonie found support after official data showed that the Canadian economy added 59,200 jobs in August, ahead of expectations for a 20,000 increase, the positive data comes after a 39,400 decline the previous month.
Canada’s unemployment rate fell to 7.1% from 7.0% in July, slightly behind expectations.
USD/CAD fell 1.0% to 1.0400.
Concerns over U.S. military intervention in Syria will overflow into next week as U.S. President Barack Obama’s seeks congressional approval to launch a missile strike.
More coverage of today’s top story.
- WSJ: Five takeaways from August jobs report. – The U.S. economy added 169,000 jobs in August, the Labor Department said Friday, and the unemployment rate fell to 7.3%. Economists are still digesting today’s report, but here are five initial takeaways.
- FT: Dollar falls on taper delay speculation. – The dollar extended earlier losses on Friday following US payrolls data that suggested the Federal Reserve may not begin its tapering programme of reducing stimulus in September, as previously expected.
More Top Stories:
Marc Chandler: U.S. jobs disappoint, spurs some jitters about tapering. – News that the US only created 169k jobs and the last two-months were 74k weaker than previously disclosed has some observers thinking twice about whether the Fed will taper at the FOMC meeting later this month. The dollar has come off and the US Treasury yields have fallen, which is helping to trigger a global bond market rally. The unemployment rate slipped to 7.3%, though again this reflects a decline in the participation rate (63.2% from 63.4%).
Antonio Fatas: The Euro counterfactual. – where would Greece or Spain or Ireland be if they had never joined the euro? What would their currency have done for them before and after the 2008 crisis? Unfortunately we cannot build such a counterfactual so the best we can do is to look for similar examples (such as Thailand during the Asian crisis). But let me argue that if one extends the set of examples and anecdotes some of the data does not speak that clearly against the euro.
Investing.com: EUR/USD gains as soft U.S. jobs report sparks dollar selloff. – The dollar slumped against the euro on Friday after the U.S. August jobs report disappointed investors and clouded expectations for a Federal Reserve start date to begin tapering the pace of its asset purchases.
Investing.com: USD/CAD tumbles 1% after U.S., Canada jobs reports. – The U.S. dollar tumbled against its Canadian counterpart on Friday, weighed by the release of lower-than-expected U.S. jobs data, as uncertainty over whether the Federal Reserve will begin tapering its stimulus program this month re-emerged.
Investing.com: GBP/USD remains higher despite U.K. data. – The pound remained higher against the U.S. dollar on Friday, despite a string of disappointing U.K. economic reports, as lower-than-expected U.S. jobs data broadly weighed on demand for the greenback.
MarketWatch: Gold futures rally after U.S. employment report. – Gold futures rallied on Friday, erasing losses after the government revised sharply lower its estimate for job growth in July and job gains for August were slightly below expectations.
BusinessWeek: Dollar slides versus yen as Treasuries halt drop. – The dollar fell for the first time in five days against the yen as U.S. Treasuries halted a decline that had taken 10-year yields to the highest level in more than two years
Source: www.forexnews.com/
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