The U.S. dollar declined against most major counterparts on Friday, after the release of payroll data from the Labor Department which unveiled that much smaller-than expected jobs were added to the economy in May.
The dollar index, which measures its strength against six other currencies, fell 0.4 percent to 96.77.
The U.S. added a modest 138,000 new jobs in May, significantly below the 185,000 that had been anticipated. Nevertheless, the unemployment rate fell to 4.3 percent, which represents its lowest level since 2001.
“The US May Jobs report was an ugly one…virtually across the board. For confirmation that the US dollar may weaken further on this, we are watching US yields as the low for the cycle in the 10-year comes into view around 2.16%. A drop below here could see USDJPY in particular challenging lower, especially if this is accompanied by a bit of risk off in equity markets,” said John Hardy, head of FX strategy at Saxo Bank.
Benchmark 10-year U.S. Treasury bond yields, dropped 5 basis points to 2.16%, the lowest level since early November.
Oil drops 2%
Brent crude oil fell below $50 on Friday, due to worries that U.S. President Donald Trump’s decision to abandon a climate pact could worsen a global glut.
“Trump’s decision to remove America from the Paris climate agreement has sparked concerns that the country will ramp up its drilling, negating any output cap implemented by OPEC,” Connor Campbell, a financial analyst at SpreadEx.
Oil prices have been under pressure because output for years has exceeded demand and created a global supply glut.
Both Brent and crude are approaching weekly losses of almost 6 percent. This number is an addition to sharp drops from last week, when OPEC did not deepen the agreed production cuts.
Considering Friday’s gold prices, the gold rose to a near six-week high, in response to disappointing U.S. non-farm payrolls. Spot gold rose 0.7 percent to $1,274.39 an ounce, its highest since April 25.