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US Dollar Climbs Against Euro and Pound on Strong US Wage Growth

January 6, 2017 at 19:19 by Yahia Barakah

A sheet of new hundred-dollar billsThe US dollar climbed against its major peers on Friday, as traders paid little attention to disappointing data that was released earlier today. The greenback is resuming its recent rally on stable economic growth and expectations of higher inflation rate in the United States.

The Bureau of Labor Statistics released its employment report at 1:30 GMT. The report said that nonfarm payroll employment rose by 156,000 jobs in December, which compares to expectations of a 178,000 increase. The increase placed total job growth in 2016 at 2.2 million, which compares to 2.7 million in 2015. Healthcare and social assistance led employment gains by 43,000 jobs and 20,000 jobs, respectively.

However, the report also revealed that private nonfarm payrolls’ average hourly earnings rose by 0.4%, or $0.10, to $26.00 in December, which compares to expectations of a 0.3% gain. Average hourly earnings lost $0.02 in November, while total yearly gains in 2016 were 2.9%.

The dollar erased most of its losses against the euro following Thursday’s disappointing ADP payroll data for the US job market. The data said that total US nonfarm private employment increased by 153,000 in December.

EUR/USD traded at 1.0526 as of 18:55 GMT on Friday, which marked the pair’s lowest level for the day, from 1.0599 at 11:00 GMT. EUR/USD opened trading today at 1.0596. GBP/USD traded at 1.2262, from an opening level at 1.2416.

The Dollar Index, which measures the performance of the US currency against a basket of its major peers, touched 102.20 as of 18:51 GMT from 101.52 on Thursday.

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

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