The dollar gave back all of the modest gains it had made against the majors in the past 24 hours following the release of March employment data which showed that the US economy had created only 103,000 jobs in the non-farm sector – half what analysts had expected and a third of the February number. Hourly wage growth of 0.3% month-on-month was in line with expectations.
The market’s interpretation is seemingly that these numbers reduce the risk of the Federal Reserve hiking rates four times this year, which in turn takes away some of the Dollar’s yield support and presumably reduces the risk of a slowdown in US and global economic growth. However, precedent suggests that by Monday morning markets’ focus will have shifted, potentially back to the escalating war of words between the US and China.
