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Dollar Retreats, Loses Ground Against Major Counterparts

The U.S. dollar climbed higher Friday morning after data showed employment in the U.S. surged by much more than expected in the month of September. However, the currency retreated quickly and turned in a mixed performance against its major counterparts.

The Labor Department data also showed the annual rate of wage growth edged down in August, easing concerns about the outlook for interest rates.

Traders now await next week’s data on inflation, and the minutes from the Federal Reserve’s latest policy meeting, for clues about the outlook for interest rates.

The Labor Department said non-farm payroll employment shot up by 336,000 jobs in September compared to economist estimates for an increase of about 170,000 jobs.

The closely watched Labor Department report also showed notable upward revisions to job growth in the two previous months.

Employment in August and July jumped by 236,000 jobs and 227,000 jobs, respectively, reflecting a net upward revision of 119,000 jobs.

The data said the unemployment rate in September came in unchanged from August at 3.8%. The unemployment rate was expected to edge down to 3.7%.

The data also showed the annual rate of wage growth edged down to 4.2% in September from 4.3% in August, while economists had expected the pace of growth to remain unchanged.

The dollar index, which climbed to 106.97, dropped to 105.95 before recovering to 106.11, but still remained well below the flat line, losing about 0.21%.

Against the Euro, the dollar weakened to 1.0586 after having firmed to 1.0483. The dollar eased to 1.2234 against Pound Sterling from 1.2193.

Against the Japanese currency, the dollar strengthened to 149.30 yen from 148.51 yen. The dollar is weak against the Aussie at 0.6383. The Swiss franc firmed against the greenback, recovering to 0.9101. The Loonie strengthened against the dollar, firming to 1.3663 after data showed a much stronger than expected addition of jobs in Canada in the month of September.

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