US Dollar Slides After June Jobs Miss; Yen Surges on BOJ Moves
June payrolls came in at just 57K against a 110K forecast, rattling the dollar and sending gold above $4,100.
The U.S. dollar tumbled Thursday after the Labor Department's June non-farm payrolls report showed only 57,000 jobs created — barely half the 110,000 economists had forecast — shocking markets and fueling speculation the Federal Reserve will hold rates steady longer than previously anticipated. The yen surged to the top of the currency leaderboard as Japanese officials shifted to what traders described as stealth intervention, with USD/JPY briefly touching 160.65 before recovering slightly to 161.14.
The initial market reaction followed a predictable script: dollar selling, a bond rally, and a quick stock bounce. But those moves faded fast in thin pre-holiday trading, leaving the S&P 500 down 0.3% on the session. Gold, however, held its gains, climbing $83 to $4,113 per ounce, while U.S. 10-year Treasury yields edged up just 1 basis point to 4.48% and WTI crude oil sat flat near $68.48.
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The jobs number raised eyebrows partly because it clashed sharply with the JOLTS report from earlier in the week, which showed job openings at a two-year high. Adding to the confusion, hospitality sector employment posted steep losses — an unusual development given the World Cup is driving tourism demand across the country. Analysts struggled to reconcile the two data sets, which may explain why the initial market moves quickly reversed.
Fed Governor Mary Daly offered a somewhat upbeat counterpoint, noting that U.S. investment growth remains "exceedingly strong." The weak payrolls print, however, is broadly expected to reduce pressure on the Fed to adjust its neutral policy stance anytime soon. Meanwhile, the euro briefly spiked to a session high of 1.1472 against the dollar before giving back roughly 40 pips as the initial payrolls-driven enthusiasm cooled.
With U.S. markets set to close early Friday for the nation's 250th Independence Day celebration, thin liquidity could amplify any follow-through moves. Traders are watching USD/JPY closely for signs of additional Japanese intervention. Continue reading at Forexlive.
