U.S. dollar posts broad gains after unexpectedly strong jobs data



(Updates to late New York trading)

By Caroline Valetkevitch

NEW YORK, Aug 5 (Reuters) - The dollar rallied across the board on Friday, notching its biggest daily percentage gain since mid-June against the yen, after a stronger-than-expected U.S. payrolls report suggested the Federal Reserve may need to continue aggressively raising interest rates in the near term.

The U.S. dollar index =USD , which measures the greenback against a basket of currencies, sharply extended gains following the report, which showed nonfarm payrolls increased by 528,000 jobs last month, the largest gain since February. That was well above economists' expectations.

The dollar index, which remains below its mid-July high, was last up 0.8% at 106.57. It was up about 0.2% just before the release of the U.S. Labor Department's employment report. The index was up about 0.6% for the week.

"This is a much stronger report than was expected. ... What it means is the Fed cannot pivot at this point. The Federal Reserve has to continue to hike rates. The folks who are saying let's take it more slowly are being shoved aside here with this report," said Axel Merk, president and chief investment officer at Merk Investment in Palo Alto, California.

"The dollar is stronger against almost everything. The U.S. is performing when the general mood is that the world is slowing down."

Against the yen, the dollar was last up 1.5% at 134.99 yen. For the week, the dollar was up 1.3% against the yen.

The Fed last week raised its policy rate by three-quarters of a percentage point. The U.S. central bank has raised that rate by 225 basis points since March, but investors had been assessing recently whether the Fed might be less aggressive in hiking rates in the future. The dollar index is up more than 11% for the year so far amid the outlook for higher rates.

Sterling GBP=D3 was down 0.8% against the dollar at $1.2066, a day after the Bank of England (BoE) raised rates by the most in 27 years to fight surging inflation and warned that a long recession would begin in the fourth quarter of this year.

The euro EUR=EBS was down 0.7% against the greenback at $1.0178.

In cryptocurrencies, bitcoin BTC=BTSP was last up 1.2% at $22,886.45.

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Currency bid prices at 3:30PM (1930 GMT) Description

RIC

Last

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Previous

Change

Session

Dollar index

=USD

106.5700

105.7000

+0.84%

11.401%

+106.9300 +105.6900 Euro/Dollar

EUR=EBS

$1.0178

$1.0247

-0.66%

-10.46%

+$1.0252

+$1.0142 Dollar/Yen

JPY=EBS

134.9850

132.9300

+1.52%

+17.23%

+135.4900 +132.5300 Euro/Yen

EURJPY=

137.40

136.18

+0.90%

+5.43%

+137.7500 +135.8100 Dollar/Swiss

CHF=EBS

0.9618

0.9552

+0.66%

+5.41%

+0.9649

+0.9539 Sterling/Dollar GBP=D3

$1.2066

$1.2158

-0.75%

-10.77%

+$1.2168

+$1.2004 Dollar/Canadian CAD=D3

1.2930

1.2863

+0.53%

+2.27%

+1.2984

+1.2865 Aussie/Dollar

AUD=D3

$0.6912

$0.6968

-0.78%

-4.89%

+$0.6975

+$0.6870 Euro/Swiss

EURCHF=

0.9789

0.9783

+0.06%

-5.59%

+0.9801

+0.9760 Euro/Sterling

EURGBP=

0.8434

0.8420

+0.17%

+0.40%

+0.8453

+0.8411 NZ

NZD=D3

$0.6241

$0.6298

-0.89%

-8.80%

+$0.6309

+$0.6215 Dollar/Dollar

Dollar/Norway

NOK=D3

9.7970

9.7275

+0.70%

+11.20%

+9.8705

+9.7255 Euro/Norway

EURNOK=

9.9770

9.9648

+0.12%

-0.36%

+10.0212

+9.9607 Dollar/Sweden

SEK=

10.1903

10.1117

+0.08%

+13.00%

+10.2356

+10.1051 Euro/Sweden

EURSEK=

10.3725

10.3641

+0.08%

+1.35%

+10.3938

+10.3504



World FX rates Link



Reporting by Caroline Valetkevitch; additional reporting by Samuel Indyk in London and Rae Wee in
Singapore; editing by Ros Russell, Angus MacSwan, Susan Fenton and Paul Simao

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