Dollar falls from three-week high after U.S. jobs data By Reuters

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© Reuters. FILE PHOTO: Illustration shows US $ 100 banknotes taken in Tokyo on August 2, 2011. REUTERS / Yuriko Nakao

By John McCrank and Elizabeth Howcroft

NEW YORK (Reuters) – The dollar fell on Friday after US non-farm payrolls data showed employment rose in May as the pandemic eased, but not as much as expected, moderating expectations that the Federal Reserve will tighten monetary policy sooner than later.

Nonfarm payrolls grew by 559,000 jobs last month, helped by higher vaccine rates COVID-19, while the unemployment rate fell to 5.8% from 6.1% in April, when the employment report was much less than expected.

The deal forecast was for 650,000 jobs added in May.

“This payroll number has been a bit disappointing,” said Edward Moya, a senior market analyst at OANDA.

The lower-than-expected report means there is no urgency for the Fed to begin lowering its $ 120 billion monthly purchase in bonds to support the economy, he said.

“Bad news about the economy is good news for an ultra-accommodative Fed that will keep the dollar on the ropes,” Moya said.

At 9:20 ET, the was down 0.403% at 90,114, falling from a three-week high earlier in the session.

The dollar rose on Thursday, growing its biggest daily gain in a month, after weekly U.S. jobless claims fell below 400,000 for the first time since the pandemic began more than a year ago and private payrolls grew significantly more than expected.

Investors were very short of dollars directed to the jobs report, showed positioning data, showing a market hypersensitive to any suggestion of a change of direction for the currency or a change in the rates.

Suddenly implied dollar / yen volatility rose to a month high above 8% on Thursday and euro / dollar implied volatility reached its highest since mid-March.

Foreign strategists in a Reuters poll split almost equally along the dollar’s ​​near-term direction after two months of broad weakness as they expect clearer signs from politicians.

The euro was up 0.33% at $ 1.21670 against the dollar.

The Australian dollar, which fell to its lowest since April on Thursday, jumped 0.78% to 0.77205, while the New Zealand dollar rose 0.64% at 0.71905.

The Japanese yen slipped 0.53%, changing hands at 109,715 against the dollar.

softened past the 6.40 level, moving away from its three-year highs as China’s central bank moved to limit the currency’s gains earlier this week.

U.S. President Joe Biden signed an order Thursday banning U.S. entities from investing in dozens of Chinese companies with alleged links to defense or surveillance technology sectors, a move his administration says expands the scope of a legally flawed Trump era.

Cryptocurrencies fell after a tweet from Tesla (NASDAQ 🙂 boss Elon Musk seemed to be lamenting a breach with bitcoin.

Tesla’s large position in bitcoin and Musk’s large personal following often set up crypto markets whenever he tweets.

Both bitcoin and ether, the two largest cryptocurrencies, declined about 6.4%, with bitcoin about $ 36,700, and ether about $ 2,640.



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