Dollar DXY Index Rises Driven by US Payrolls

successful field

The DXY index, which measures the dollar against a basket of stronger currencies, rose this Friday after boosting May payrolls data from the United States. The report reinforced the outlook for monetary tightening by the Federal Reserve (Fed, US Central Bank) to raise the prime interest rate by 50 basis points over the next two meetings.

In New York late in the afternoon, the dollar rose to 130.87 yen, the euro fell to US$1.0723 and the pound fell to US$1.2497. The DXY rose 0.31% to the 102,140 mark.

The US economy created 390,000 jobs in May, which is higher than expected by 328,000. The unemployment rate was steady at 3.6% and the median hourly wage rose 0.3%, or $0.10, from April to $31.95, slightly below the higher forecast of 0.4%.

According to CIBC, while hiring has slowed slightly, it remains “too hot” for the Fed to relax. As such, according to the Canadian bank, with hiring at a solid pace, “we are still clearly on track for growth of 50 basis points over the next two meetings.”

Responding to the report, the dollar strengthened against its rivals. “The dollar was nearly flat against the euro and pound sterling prior to today’s May jobs report. A strong jobs report suggests the Fed may be hesitant to ease aggressive interest rate hikes in September, which will be considered favorable for the dollar.” supposedly”, analyzes the Western Union.

The yen extended recent losses against the dollar after Bank of Japan (BOJ) Governor Haruhiko Kuroda acknowledged the country’s inflation risks, but insisted that expansionary monetary policy would be maintained. “It is important to create an economic environment where wages can grow higher,” he said.

See also  US House moves forward with Biden's trillion domestic agenda Economy

About the author: Sarah Gracie

"Proud social media buff. Unapologetic web scholar. Internet guru. Lifelong music junkie. Travel specialist."

Related Posts

Leave a Reply

Your email address will not be published.