US Jobs Data Had A Short-Lived Impact On The Dollar
The American dollar fell versus major currencies today. The dollar index, which measures the greenback’s strength against a basket of six major currencies, dropped by 0.18% to 93.99 after rising 0.22% on Friday. The USD/JPY pair fell to 109.46.
The euro strengthened, as concerns over the political situation in Italy subsided after anti-establishment parties reached a deal on a proposed coalition government, which eased fears that repeat elections could give a mandate for the country to exit the Eurozone. The EUR/USD pair gained 0.24% to 1.1687 level.
Meanwhile, most Asian currencies were trading higher after US jobs data added to optimism over the strength of the world’s largest economy. US nonfarm payroll figures came in well ahead of estimates on Friday, bolstering the case for the Federal Reserve to hike four times this year.
Trade tensions flared up again after finance ministers from the world’s leading economies criticized America’s new tariffs on steel and aluminum imports at a G7 meeting in Canada over the weekend. Trade talks between the US and China ended without a breakthrough, raising the danger that negotiations could collapse.
China has balked at stepping up its purchases of American products, raising the odds of a trade war, if President Donald Trump follows through on his threat to tax billions of dollars' worth of Chinese imports. The warning from Beijing came after delegations led by US Commerce Secretary Wilbur Ross and China's top economic official, Vice Premier Liu He, wrapped up talks on Beijing's pledge to narrow its trade surplus. US representatives were insisting on fundamental changes in ties between the world's two biggest economic powers.