Investing.com – The U.S. dollar remained on track for a second-straight weekly win despite rising investor expectations that the Federal Reserve will keep monetary policy tightening on hold following a mixed U.S. jobs report.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.11% to 97.03.
The Nonfarm payrolls rose by just 182,000 compared to expectations for a 175,000 gain, according to estimates from Investing.com.
The unemployment rate remained unchanged to 3.8%, but average hourly earnings, an important number to gauge inflation, slowed to 0.1% from 0.4% year over year in March.
The mixed jobs report does little to divert the Fed's current course of no-action, analysts argued.
"The data supports the thesis that the Fed is on hold for a long time. Until wages flare higher, there is little threat of inflation topping the target," BMO said. "At the same time, with the jobless rate likely to grind lower as the economy picks up modestly in the spring, there is no compelling reason to ease policy."
A slump in sterling also helped the greenback hold gains as worries about a no-deal Brexit flared after EU leaders said Prime Minister Theresa May had not put forward credible reasons as to why the UK should be granted an extension for Brexit.
“If we are not able to understand the reason why the UK is asking for an extension, we cannot give a positive answer,” said French Finance Minister Bruno Le Maire. German Justice Minister Katarina Barley tweeted: “This playing for time must end.”
This comes after May and opposition leader Jeremy Corbyn failed to find a plan to break the Brexit logjam, leaving the prime minister with little option but to ask the EU for extension to Brexit.
GBP/USD fell 0.35% to $1.3031, while EUR/USD added 0.03% to $1.1217.
USD/JPY gained 0.05% to Y110.20 as falling U.S. government bond yields did little spark a bid in the greenback.
USD/CAD rose 0.29% C$1.3396 as oil prices recovered losses from a day earlier, underpinning the loonie.