After staying somewhat subdued around the flat line in the Asian session on Friday, the U.S. dollar moved up smartly in the European session after data showed another surge in U.S. employment and a significant drop in unemployment in the month of August.
Data from the Labor Department showed that non-farm payroll employment surged up by 1.371 million jobs in August compared to economist estimates for a jump of about 1.400 million jobs.
The report also showed the spike in employment in July was downwardly revised to 1.734 million jobs from the previously reported 1.763 million jobs.
The unemployment rate dropped to 8.4% in August from 10.2 percent in July, while economists had expected the rate to dip to 9.8%.
The dollar index, which rose to 93.24 a little before noon, dropped to around 92.70 by mid afternoon before edging up to 92.82, recording a small gain of about 0.08%.
Against the Euro, the dollar firmed up to $1.1781 but pared gains and eased to $1.1841 as the day progressed, still holding positive with a modest gain.
The Pound Sterling weakened to $1.3176 a unit but later rallied to $1.3278, cutting down its loss. The Sterling had fetched $1.3280 Thursday evening.
The Yen was slightly weaker at 106.26 compared to 1016.19 a dollar yesterday. The currency weakened to 106.50 a dollar after U.S. jobs data, but regained most of the lost ground as the day progressed.
Against the Aussie, the dollar was weaker at 0.7288, easing from 0.7273. The Swiss franc shed more than 0.4% against the dollar, falling to CHF 0.9131 from CHF 0.9094.
The Loonie firmed up to 1.3056 a dollar, after having closed at 1.3128 a dollar on Thursday. Upbeat jobs data buoyed up the Canadian currency. According to official data released Friday morning, employment in Canada increased by 245,800 in August 2020, less than an expected addition of about 275,000 jobs, and addition of 418,500 jobs in July.
Full time employment increased by 205,800 in the month, while part time employment decreased to 40,000 in August from 345,300 a month earlier.
Meanwhile, unemployment rate decreased to 10.2% in August from 10.9% in the previous month.
The material has been provided by InstaForex Company – www.instaforex.com