The U.S. dollar remained strong at the start of the week following Friday’s stronger-than-expected non-farm payrolls report, which tempered expectations for an imminent Federal Reserve rate cut. According to the data, the U.S. economy added 206,000 jobs in June, exceeding economists’ forecasts and reinforcing the Fed’s cautious stance on inflation and monetary policy. The positive data underpinned the dollar, pushing it higher against major currencies including the euro and yen.
Meanwhile, traders are closely watching upcoming U.S. inflation figures and Federal Reserve Chair Jerome Powell’s testimony before Congress for further signals on the timing of rate adjustments. While job growth slowed from May’s revised figure, the unemployment rate also edged up slightly to 4.1%, suggesting a nuanced labor market picture. Nonetheless, with inflation still above the Fed’s target, policymakers may maintain a patient approach, supporting the dollar’s strength in the near term.
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