Dollar stays lower after US jobs data; euro up ahead of French election
Federal Reserve could begin cutting interest rates in September.
Nonfarm U.S. payrolls increased by 206,000 jobs last month, the Labor Department report showed. Data for May was revised sharply down to show 218,000 jobs added instead of the previously reported 272,000. The unemployment rate rose to 4.1%, slightly higher than the estimated 4.0%.
Investors have been watching the labor market and inflation data closely as they try to gauge when the Fed could begin cutting rates from nearly two-decade highs.
The dollar index initially extended declines after the data. The dollar weakened against the yen before paring losses.
The dollar index, which measures the greenback against a basket of currencies, was last down 0.28% at 104.87 and hit a three-week low early.
Against the Japanese yen, the dollar weakened 0.34% to 160.73. It was near 160.45 just after the U.S. payrolls data.
«We see rates coming down across the curve on confirmation of a moderation in U.S. labor markets. The unexpected rise in the unemployment rate, the deceleration in wage gains and revisions in prior months' headline gains all point to a slowing in labor market conditions,» said Karl Schamotta, chief market strategist at Corpay in Toronto.
«This is… raising the likelihood that we do see (Fed) Chair Powell put a September rate cut on the table either at the July policy meeting or at the Jackson Hole conference in August.»
Futures markets are now pricing in a roughly 72% chance for a 25 basis point rate cut at the Fed's meeting in September,
