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Dollar falls Vs euro despite strong US jobs report

AFP | Last Updated: Saturday, December 7, 2013 - 15:00

New York: The US dollar fell against the euro but gained on the yen after a surprisingly solid jobs report for November gave more evidence of the firming US economy.

Job creation was greater than expected, and the US unemployment rate dropped to 7.0 percent from 7.3 percent, numbers that raised expectations that the Federal Reserve will soon begin reeling in its USD 85 billion-a-month economic stimulus program.

But that prospect, which pushed up US bond yields slightly and could lead to higher interest rates, failed to give the dollar a boost.

At 2200 GMT, the dollar was at USD 1.3705, compared to USD 1.3666 late Thursday.

Nick Bennenbroek at Wells Fargo Securities said the dollar`s weakness suggests the market believes the report "arguably... does not provide a decisive case for the Fed to begin reducing the pace of its bond purchases at this month`s meeting."

Fed policymakers meet on December 17-18 to review monetary policy, and tapering the stimulus program will be a key focus of discussions.

The yen meanwhile sank, with the dollar barely shy of its high for the year against the Japanese currency and the euro scoring a five-year high.

The dollar climbed to 102.85 yen from 101.77 Thursday, and the euro hit 141.03 yen, up from 139.08.

"The yen underperformed on Friday as advancing world stocks helped whet some risk taking," said Joe Manimbo at Western Union.

"The yen fell to a six-month low against the greenback this week on the view that Japan`s central bank is a longer way from shifting course on easy policies compared to counterparts in the US and Europe."

The British pound edged higher to USD 1.6346 from USD 1.6333, while the dollar slipped to 0.8915 Swiss franc from 0.8966 franc.

First Published: Saturday, December 7, 2013 - 14:58
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