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Friday, March 29, 2024
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Dollar takes breather after rallying on robust US jobs

TOP NEWS

The greenback bought 118.85 yen in Tokyo afternoon trade, slightly down from 119.00 yen in New York Friday afternoon but still sharply up from 117.33 yen in Tokyo earlier Friday.

The euro bought $1.1334 compared with $1.1316 in US trade and 134.72 yen against 134.65 yen.

On Friday the US Labor Department said the world’s largest economy added a better-than-expected 257,000 jobs in January and revised upward already healthy growth in the prior two months. The gains were the best over three months since 1997.

Investors poured into the dollar on expectations the Fed will hike interest rates around the summer as it tries to prevent bubbles from developing in the US economy, which is on a strong recovery track.

“If employment data remain strong, it is highly possible that rates will be raised by mid-year even if pay rises are small,” Junichi Makino, chief economist at SMBC Nikko Securities, said in a note.

If the Fed raises rates by 1.0 percentage point annually, the dollar could rise to 125 yen by the end of the year, he said, adding that it could hit 131 yen if the Bank of Japan eases monetary policy further.

The dollar was higher against other Asia-Pacific currencies.

It gained to 62.08 Indian rupees from 61.72 rupees on Friday, to 12,647.50 Indonesian rupiah from 12,624.40 rupiah and to 1,097.72 South Korean won from 1,087.30 won.

The greenback also rose to Tw$31.54 from Tw$31.42, to Sg$1.3528 from Sg$1.3451, to 32.61 Thai baht from 32.57 baht and to 44.28 Philippine pesos from 44.17 pesos.

The Australian dollar fell to 77.60 US cents from 78.27 cents, while the Chinese yuan increased to 19.04 yen from 18.80 yen.

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