The US dollar rebounded on Friday following the release of data showing that the world's largest economy generated significantly more jobs than anticipated last month. This suggests that the Federal Reserve may postpone its easing cycle this year.
Can Upbeat NFP Push The US Dollar (USDX) Price Higher?
The dollar index (DXY) monitors the currency's value against six main peers, most notably the euro, which increased by 0.8% to 104.91, its highest daily gain since April 10.
The index was expected to increase by 0.2% for the week as the strong employment report counteracted weaker macroeconomic data that had previously prompted investors to contemplate two quarter-point Fed rate cuts in 2024.
The number of jobs added to U.S. nonfarm payrolls increased by 272,000 last month, but revisions revealed that 15,000 fewer jobs were created in March and April combined than had been previously reported. According to economists surveyed by Reuters, payrolls were anticipated to increase by 185,000.
After experiencing a 0.2% rate in April, the average hourly earnings increased by 0.4%. The previous month's upwardly revised 4.0% annual increase was followed by a 4.1% increase in wages over the 12 months ending in May.
Nevertheless, the unemployment rate increased from 3.9% in April to 4%, surpassing a threshold maintained for 27 consecutive months.
