Dollar down as jobs data imply slower US rate hike path

The US dollar weakened on Friday after US labor data for last month showed slower wage growth, suggesting that an easing of inflation pressures might keep the US Federal Reserve’s pace of interest rate hikes modest and thereby reduce the greenback’s appeal.

The US economy last month added jobs at a brisk pace, but slower wage growth and a rise in the unemployment rate prompted financial markets to dial back expectations of a 50 basis point rate hike when Fed policymakers meet in two weeks.

Congressional testimony earlier in the week by Fed Chairman Jerome Powell was seen as hawkish and strengthened the US dollar as US Treasuries pay more in yield than other government debt.

Photo: Reuters


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