The US dollar is strengthening against some of its most traded currency competitors to close out the trading week after the US government reported a better-than-expected jobs report. The economy continues to show signs that it is rebounding on the other side of the COVID-19 lockdown. But the labor market is still short 13 million positions that were lost amid the pandemic.
According to the Bureau of Labor Statistics (BLS), the US economy created 1.76 million new jobs in July, beating the median estimate of 1.6 million. This is down from the huge 4.8 million added jobs in June. The unemployment rate fell to 10.2%, down from 11.1%. This is lower than the forecast of 10.5%.
Once again, the new jobs were seen across the board: leisure and hospitality, retail, professional and business services, and health care. The government added 301,000 new jobs, while the manufacturing sector picked up 26,000.
In other labor numbers, average hourly earnings rose 0.2% last month, average weekly hours dipped to 34.5, and the labor force participation rate slipped to 61.4%.
Despite a robust jobs report, the world’s largest economy is still enduring a slowdown in hiring, which would make it harder for the country to recover. The nation lost more than 22 million jobs at the height of the public health crisis, and about 30 million Americans are collecting jobless benefits. So far, the US has reclaimed more than nine million jobs, which has resulted in calls for the federal government to maintain its $600-a-week unemployment benefits.
On Thursday, the number of Americans filing for first-time unemployment benefits came in at 1.186 million for the week ending August 1, better than the forecast of 1.415 million.
Although the leading stock indexes have trimmed some of their losses in pre-market trading, they have hardly reacted to the news. Gold and silver prices are trading higher, and crude oil is relatively flat.
The US Dollar Index, which gauges the greenback against a basket of currencies, surged 0.42% to 93.22, from an opening of 92.81. The index will suffer a weekly loss of about 0.2%, driven mostly on inflation fears and broader confidence in global financial markets. Year-to-date, the buck has roughly 3.3%.
The USD/CAD currency pair rose 0.14% to 1.3329, from an opening of 1.3311, at 12:50 GMT on Friday. The EUR/USD dropped 0.3% to 1.1842, from an opening of 1.1879.
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