The dollar fell today, Friday, after signs of a decline in the strength of the US labor market contributed to reducing expectations for how long the Federal Reserve (the US central bank) will keep interest rates high, but the yen jumped thanks to fears that the yields of the US benchmark ten-year bonds will rise above 4 percent. .
The US Department of Labor said in a jobs report that the US economy created the lowest number of jobs in June in two and a half years. The report also showed that the number of jobs created in April and May was 110,000 fewer than previously reported.
The yen jumped 1.33 percent against the dollar to 142.15 yen against the dollar, its highest level in two weeks against the greenback, as the benchmark 10-year Treasury bond increase by more than 4 percent fueled fears that Japan might intervene in the currency exchange markets, according to Jo. Manimbo who is a senior market analyst.
Strong economic data on the US economy pushed short-term US Treasury yields to their highest level since 2007, reflecting expectations that the central bank may raise interest rates by 25 basis points on July 26 at the close of a two-day monetary policy meeting.
Japanese Labor Ministry data showed that regular wages recorded their largest annual increase in May since early 1995, boosting investor expectations that the Bank of Japan will adjust monetary easing policy sooner rather than later.
The dollar index fell 0.815 percent to 102.240, while the euro rose 0.76 percent to $1.0969 per euro.
The Australian dollar rose 0.8% to 0.6681 against the dollar, but was still under pressure from weak economic data from China and lack of risk appetite in previous sessions.
The yuan in transactions outside China fell 0.4 percent to 7.2257 against the dollar.
The US Non-Farm Payrolls report is due out later today, while the US economy is expected to have added 225,000 jobs in June.
2023-07-07 19:46:03
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