US Continues Rally After NFP Stumble

The U.S. dollar advanced against other major currencies on Monday as signs of rising wage inflation in Friday’s U.S. jobs report could keep the Federal Reserve on course for dollar-supportive interest-rate tightening later this year.

The greenback was broadly firmer in response. One dollar USDJPY, +1.24%  bought ¥108.20 up 1% from ¥107.12 late Friday in New York. Euro/dollar EURUSD, -0.1140%  traded at $1.1377, compared with $1.1406 at the end of last week. The British pound GBPUSD, -0.0277%  was at $1.4446, basically unchanged from late Friday.

The U.S. Dollar Index DXY, +0.15%  , which measures the buck against about a half-dozen other currencies, traded up 0.1% at 94.00.

In Friday’s report, U.S. nonfarm payrolls rose by a seasonally adjusted 160,000 jobs in April, undershooting a 205,000 increase expected, but average hourly earnings of private-sector workers advanced 2.5% in April from a year earlier.

Other labor market signs give dollar bulls hope. In a speech in London Monday, Fed member Charles Evans also pointed to rising labor participation.

via MarketWatch

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza