Around 9 p.m., the Dollar index gained 0.48% to 112.79 points. The euro yielded 0.55% to 0.9737 dollars and the pound 0.83% to 1.1069 dollars.
The dollar climbed on Friday, the solid job creations in the United States accompanied by a decline in the unemployment rate encouraging the Fed (US Federal Reserve) to continue its marked increases in interest rates.
Around 7:00 p.m. GMT, the Dollar index, which compares the greenback to a basket of other major currencies, gained 0.48% to 112.79 points.
The euro yielded 0.55% to 0.9737 dollars and the pound 0.83% to 1.1069 dollars.
In the United States, the unemployment rate fell to 3.5% in September, its pre-pandemic level and the lowest in fifty years. Job creations certainly fell compared to August but remained solid at 263,000, more than expected.
Counterintuitively, good news for US job seekers weighs on stock markets but boosts the dollar, because it means that the Fed, the US central bank, could act vigorously to counter inflation.
“A strong labor market means a strong dollar,” said Joe Manimbo of Convera Financial Services.
The greenback was thus carried by the rise in bond yields. The rate on two-year US Treasury bills exceeded 4.31% against 4.25% the day before, that of 10 years rose to 3.88% against 3.82% on Thursday.
“The labor market is tight enough to allow the Fed to act,” said Neil Wilson, analyst at Markets.com.
After the publication of the employment report, investors were expecting a further increase of 0.75 points at the next Fed meeting in early November.
Several officials of the American monetary institute affirmed throughout the week their determination to raise rates.
“As long as the economy is doing well, it is easy for central banks to be aggressive” and to promise rate hikes to fight inflation, judge You-Na Park-Heger, an analyst at Commerzbank.
Conversely, in Europe, the prospect of a difficult winter is weighing on currencies.
The pound, in particular, had hit a historic low of $1.0350 against the greenback in late September in the wake of controversial and unquantified budget announcements from the UK government.
If the currency has risen, “the medium-term outlook for the United Kingdom remains very uncertain,” warns Matthew Ryan, analyst at Ebury.