NEW YORK- The dollar fell to a six-week low on Friday after data showed the world’s largest economy created fewer jobs than expected last month, reinforcing expectations the Federal Reserve is likely to hold interest rates steady again at its December meeting.
The dollar index, a gauge of the greenback’s value against six major currencies, dropped 1.1 percent to 105.03, after earlier sinking to 104.93 its lowest since Sept. 20. The index was on track for its largest one-day fall since July.
For the week, the greenback was down 1.4 percent , on pace for its worst weekly performance since July as well.
Data showed nonfarm payrolls increased by 150,000 jobs last month. The numbers for September were revised lower to show 297,000 jobs created instead of 336,000 as previously reported.
“From my view, the Fed rate hike cycle is over and this reaffirms the view that the Fed should not hike rates again,” said Ronald Temple, chief market strategist at Lazard in New York.
“If you look at the new jobs, 150,000 versus 180,000 expected – that is still a strong jobs-creation number, but more in line with what the US economy needs relative to population growth and the stable unemployment rates. That is a Goldilocks number,” he said, suggesting it was ideal for the economy.
Against the yen, the dollar fell to a two-week low of 149.18, and was last down 0.8 percent at 149.315 yen capping a whirlwind week, in which the Japanese currency touched a one-year low against the dollar and 15-year trough against the euro.
On the week, the dollar was down 0.2 percent versus the yen, its biggest weekly loss since late July.
The drop in the yen earlier in the week came after the Bank of Japan tweaked its yield curve control policy on Tuesday, but not by as much as markets had expected.