The U.S. dollar turned in a mixed performance against other major currencies on Friday. The dollar reacted to jobs data from the U.S. and Canada, and a report showing a weak reading of Japan’s leading index.
Data showing a much smaller than expected increase in unemployment and a bigger-than-expected increase in jobs growth in the month of May did help the greenback against some currencies, but overall, it was a mixed show by it on.
The Labor Department said non-farm payroll employment jumped by 2.51 million jobs in May after plummeting by a revised 20.69 million jobs in April.
Economists had a loss of another 8.0 million jobs following the nosedive of 20.5 million jobs originally reported for the previous month.
Employment rose sharply in leisure and hospitality, construction, education and health services, and retail trade, according to the Labor Department.
The Labor Department claimed the improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus pandemic and efforts to contain the spread of the disease.
With the unexpected rebound in employment, the Labor Department said the unemployment rate dropped to 13.3 % in May from 14.7% in April. Economists had expected the unemployment rate to surge up to 19.8%.
The dollar index, which rose to 97.03, continued to hold firm around 97.00. It was last seen at 96.98, up 0.3% from previous close.
Against the Euro, the dollar firmed up to $1.279 before paring some gains, but was still fairly well placed in positive territory at $1.1290, gaining about 0.4%.
The European Central Bank announced Thursday it will increase its Pandemic Emergency Purchase program by a further 600 billion euros to support funding conditions in the real economy, especially for businesses and households. Markets were expecting an increase of 500 billion euros.
Against Pound Sterling, the dollar weakened to $1.2668, notably down from Thursday’s $1.2594.
The Japanese currency weakened to 109.59 from 109.15 a dollar after data from the Cabinet Office showed Japan’s leading index declined to the lowest in eleven years.
The leading index, which measures the future economic activity, fell to 76.2 in April from 85.1 in March. Economists had expected a score of 84.5.
The coincident index that reflects the current economic activity decreased to 81.5 in April from 88.8 a month ago. Economists had forecast a score of 90.3.
The Aussie was stronger at US$0.6969, after closing at $0.6942 on Thursday.
Against Swiss franc, the dollar strengthened to CHF0.9623, rising from CHF0.9555.
Against the Loonie, the dollar was weak at C$1.3422, down nearly 0.6% from C$1.3500. Stronger than expected Canadian jobs data lifted the loonie against the greenback. According to the data released by Statistics Canada this morning, the Canadian economy added 289,600 jobs in May, with businesses reopening amid easing public health restrictions.
The unemployment rate rose to a record high of 13.7%, topping the previous high of 13.1% set in December 1982 in more than four decades of comparable data. Economists had predicted a loss of about 500,000 jobs in May and expected unemployment rate to come in at 15%.
Statistics Canada said the number of people who worked less than half their usual hours fell by 292,000 in May.