Dollar Drifts Lower Against Major Counterparts After Jobs Data

(RTTNews) - The U.S. dollar shed ground against its major counterparts on Friday, as data showing a smaller than expected addition in non-farm payroll employment in the month of July triggered speculation that the Federal Reserve has neared the end of the tightening cycle.

The Labor Department's report showed non-farm payroll employment climbed by 187,000 jobs in July after rising by a downwardly revised by 185,000 jobs in June.

Economists had expected employment to jump by 200,000 jobs compared to the addition of 209,000 jobs originally reported for the previous month.

Meanwhile, the Labor Department said the unemployment rate edged down to 3.5 percent in July from 3.6 percent in June. Economists had expected the unemployment rate to remain unchanged.

The Labor Department also said average hourly employee earnings increased by $0.14 or 0.4 percent to $33.74 in July.

Annual wage growth came in at 4.4% in July, unchanged from June. Economists had expected the pace of growth to slow to 4.2%.

Following the mixed report, most economists still expect another pause in interest rate hikes by the Federal Reserve next month, although the data has led to some uncertainty about the outlook for rates beyond that.

The dollar index, which dropped to 101.74, recovered to 102.02, but still remained notably down in negative territory with a loss of about 0.52%.

Against the Euro, the dollar weakened to 1.1008 from 1.10950. Against Pound Sterling, the dollar is weak at 1.2746, and against the Japanese currency dropped more than 0.5%, fetching 141.78 yen a unit, compared to 142.54 yen a unit on Thursday.

The dollar is weak against the Aussie at 0.6567. The Swiss franc is up marginally at CHF 0.8731 a dollar, while the Loonie is down at C$1.3385 a dollar.