Dollar gains after this morning’s surprisingly strong US jobs data
Scott Petruska, CFA " | July 5, 2019
The dollar jumped following stronger than expected US jobs data. The US added 224k jobs in June, much better than the expected 160k. Investors had been positioned for a Fed rate cut later this month, so were caught wrong-footed, as the odds quickly dropped for such a cut. In addition to dollar gains, stock futures fell and bond yields jumped.
July 5, 2019
EUR/USD 1.1215 GBP/USD 1.2498 USD/CAD 1.3122 AUD/USD 0.6968 USD/JPY 108.59 USD/CNH 6.8954 USD/ILS 3.5718 USD/MXN 19.0678 USD/CHF 0.9922 USD/INR 68.42
The dollar rallied across the board following upbeat US jobs data for June – US Payrolls climbed 224,000, Unemployment rose from 3.6% to 3.7%, and Average Hourly Earnings increased from a 3.1% YOY. US stocks and bond selling was also quickly seen.GBP
After the strong US jobs data report, the UK pound quickly dropped to close at $1.25. It approaches last December’s lows just under $1.25. Boris Johnson, front-runner to replace Theresa May as UK prime minister, said that delivering Brexit would be key to keeping the UK together.EUR
The euro dropped in European trading after release of weak German factory orders for May. The Stoxx Europe 600 Index fell by 0.4%, its biggest sell-off in more than a month. After the US jobs data, the EUR/USD currency pair dropped 50 pips.CADThe USD/CAD currency pair jumped by 70 pips – C$1.3057 to C$1.3127 - following a combination of strong US jobs data and weak Canadian jobs data. Unemployment in Canada edged higher to 5.5% in June.ASIA/PACIFIC
The USD/JPY currency pair jumped nearly 50 pips after strong US jobs data. In overnight trading, the yen held steady after a surprise 4% gain in Japan’s Housing Spending for May YOY, its strongest in four years.
The USD/CNY currency pair moved higher, as emerging market stocks fell and currencies dropped after the strong US jobs data.