By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) – The U.S. dollar rose across the board on Friday after data showed the world’s largest economy created more jobs than expected last month, reinforcing expectations that the Federal Reserve will end its rate-cutting cycle at its policy meeting later this month will interrupt. .
The dollar rose to its highest level since July against the yen after the data and was last up 0.1% at 158.27 yen. The US currency has risen in five of the past six weeks.
The euro, on the other hand, fell to its lowest level against the dollar since November 2022. The euro zone’s common currency last fell 0.6% to $1.024, falling for the second week in a row.
A significant number of currency forecasters expect the euro to reach parity with the dollar by 2025, a Reuters poll showed this week.
A Labor Department report shows that the U.S. economy added 256,000 jobs in December, far more than economists expected of an increase of 160,000. The November jobs figure was revised downwards to 212,000.
The unemployment rate, meanwhile, fell to 4.1%, compared with expectations of 4.2%, while the average hourly wage rose 0.3% last month, after rising 0.4% in November. In the 12 months to December, wages rose 3.9%, following a 4.0% increase in November.
“I think this will only lead to a continuation of the US dollar’s upward trend, which has been the market’s favorite for some time, and certainly serves to reinforce the US exceptionalism theme, and the Fed should be relatively aggressive compared to peers in the G10 space,” the CEO said. Michael Brown, senior research strategist at Pepperstone in London.
Following the non-farm payrolls figure, the US interest rate futures market has fully priced in a pause in the Fed’s easing cycle at its January meeting, according to LSEG estimates. The market has also priced in only 31 basis points of easing in 2025 or just one rate cut, with the first rate hike likely at the June meeting.
In other currencies, sterling fell to its weakest level against the dollar since November 2023, last changing hands at $1.2247, down 0.5%. It was also sold on Thursday, along with a sell-off in government bonds and concerns about Britain’s public finances.
In Japan, prospects of continued wage increases and the boost to import costs from a weak yen have increased central bank attention to rising inflation pressures that could lead to an upgrade in price forecasts this month, sources said.
The , meanwhile, moved to its highest level since November 2022 and was on track for a sixth straight weekly gain. That is the longest period since an eleven-week period in 2023. The index last rose 0.2% to 109.48.
Currency
bid
prices at
10
January
02:44
pm GMT
Description RIC Last US Pct YTD Pct High Low
at Close Change bid
Last
Session
Dollar 109.39 109.2 0.17% 0.83% 109.97 109.
index 07
Euro/pop 1.0271 1.0299 -0.27% -0.78% $1.0312 $1.0
am 212
Dollar/Year 157.74 158.105 -0.19% 0.29% 158.86 157.
no. 645
Euro/yen 162.06 162.85 -0.49% -0.71% 163.18 162.
05
Dollar/SW 0.9149 0.9123 0.3% 0.83% 0.9189 0.91
iss 15
Sterling/ 1.2246 1.2307 -0.48% -2.08% $1.2323 $1.2
Dollars 194
Dollar/Approx. 1.4394 1.4392 0.02% 0.1% 1.4437 1.43
nadian 76
Australia/Thurs 0.6167 0.6198 -0.46% -0.3% $0.6206 $0.6
lar 139
Euro/Swiss 0.9396 0.9393 0.03% 0.03% 0.9419 0.93
s 86
Euro/Star 0.8384 0.8365 0.23% 1.34% 0.8393 0.83
ling 66
New Zealand 0.5567 0.56 -0.58% -0.51% $0.5603 0.55
Dollar/Do 43
llar
Dollar/no 11.4159 11.3944 0.19% 0.44% 11.5117 11.3
road 921
Euro/Norwegian 11.7266 11.7186 0.07% -0.36% 11.791 11.7
yes 174
Dollar/SW 11.1842 11.1538 0.27% 1.52% 11.2547 11.1
Eden 36
Euro/Sweden 11.4879 11.4881 0% 0.18% 11.5053 11.4
en 75
