Investing.com - The dollar trimmed gains but remained broadly supported against the other major currencies in light trade on Monday, as Friday’s strong U.S. employment data continued to boost optimism over the strength of the economy.
GBP/USD edged up 0.14% to 1.29707, still close to last week’s fresh 31-year lows of 1.2796.
The Labor Department reported on Friday that the U.S. economy added 287,000 jobs last month, well above the 175,000 jobs forecast by economists. Average hourly earnings were up 2.6% compared with a year earlier.
The report also showed that the unemployment rate ticked up to 4.9% and May’s payrolls figure was revised down to 11,000 from a previously reported 38,000, the smallest monthly increase since 2010.
The strong jobs report was seen as unlikely to alter the Federal Reserve’s cautious plans for raising interest rates.
Investors were eyeing the Bank of England’s policy meeting, scheduled later in the week.
The BoE could potentially ease monetary policy to cushion the U.K. economy from the impact of Brexit, which would also pressure sterling lower.
USD/JPY rallied 1.72% to 102.31, while USD/CHF held steady at 0.9831.
The yen weakened after Prime Minister Shinzo Abe’s ordered a new round of fiscal stimulus spending.
The move came after Abe’s ruling coalition increased its majority in the upper house in parliamentary elections on Sunday.
EUR/USD was little changed at 1.1044.
The Australian and New Zealand dollars were weaker, with AUD/USD down 0.13% at 0.7562 and with NZD/USD retreating 0.77% to 0.7252.
Elsewhere, USD/CAD rose 0.21% to trade at 1.3069, the highest since June 28.
The commodity currencies weakened as oil prices slid lower on Monday amid signs of an ongoing recovery in U.S. drilling activity.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.28% 96.58, just off two-week highs of 96.81 hit overnight.