WASHINGTON (dpa-AFX) - The U.S. dollar advanced notably against most major currencies on Friday, buoyed by data showing stronger-than-expected jobs growth in the month of June.
The somewhat upbeat data dampened hopes for a near-term interest rate cut by the Federal Reserve. Over the past few sessions, traders were betting on a steep cut in interest rates after key Fed officials hinted at such a possibility. Recent economic data also seemed to suggest a cut in interest rate as early as this month.
The dollar index rose to near 3-week high of 97.44 earlier in the day, but gave up some gains as the session progressed. It was last seen hovering around 97.25, up by about 0.5% from previous close.
Against the euro, the dollar was up over 0.5% at $1.1226, despite having pared some gains after rising to a high of $1.1208.
The greenback, at $1.2526, was up more than 0.4% against the pound sterling. It strengthened to $1.2481 before paring some gains.
The Japanese yen weakened to 108.64 a dollar before recovering modestly to 108.50 a dollar, but still down with a pronounced loss of more than 0.6%.
The dollar was up by about 0.7% against Swiss franc with the pair trading at 0.9920.
Against the Aussie, the dollar gained nearly 0.6% at 0.7981, while its gains were a modest 0.17% at 1.3074 against the loonie.
Data from the Labor Department showed that employment surged by 224,000 jobs in June after edging up by a downwardly revised 72,000 jobs in May. Economists expected employment to increase by about 160,000 jobs.
Despite the stronger than expected job growth, the unemployment rate inched up to 3.7% in June from 3.6% in May. The unemployment rate had been expected to hold steady.
The Federal Reserve Chairman Jerome Powell said last last month that risks to economic outlook had intensified and the bank would 'act as appropriate to sustain the expansion.'
St. Louis Fed chief James Bullard also hinted at a likely cut in interest rates in the near term.
However, today's solid jobs data has somewhat dimmed chances of any steep cut interest rates later this month.
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