Dollar remains firm after U.S. jobs data

The dollar remained well bid close to recent highs against the other major currencies on Monday as Friday’s stronger-than-expected U.S. nonfarm payrolls report bolstered investor confidence in the country’s economic recovery.

The U.S. economy added 236,000 jobs last month official data on Friday showed, well above expectations for an increase of 160,000. The unemployment rate ticked down to 7.7%, the lowest level since December 2008, from 7.9% in January.

The robust data added to speculation over an earlier-than-expected end to the Federal Reserve’s easing program, bolstering demand for the dollar.

During U.S. morning trade, the dollar was little changed near the highest level since June 2010 against the pound, with GBP/USD edging up 0.04% to 1.4917 as prospects for a triple-dip recession and more easing by the Bank of England continued to pin down sterling.

The dollar eased against the euro but remained close to three-month highs, with EUR/USD rising 0.13% to 1.3013.

The euro found some support after official data showed that German exports rose by a seasonally adjusted 1.4% in January, the biggest increase in five months, while imports rose 3.3%.

But sentiment on the single currency remained weak following a one-notch downgrade on Italy by ratings agency Fitch in Friday, citing political uncertainty and a deepening recession.

Elsewhere, the dollar was trading close to its highest level in three-and-a-half years against the yen, with USD/JPY inching up 0.02% to 96.06 as expectations for further easing by the Bank of Japan weighed on the yen.

Earlier Monday, incoming BoJ Governor Haruhiko Kuroda said he would do “whatever is needed” to beat deflation and achieve the 2.0% inflation target adopted by the central bank in January.

The greenback was lower against the Swiss franc with USD/CHF down 0.28% to trade at 0.9491.

In Switzerland, official data showed that retail sales rose 1.9% in January, below expectations for a 2.8% increase.

The greenback was broadly lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD down 0.20% to 1.0266,AUD/USD climbing 0.28% to 1.0264 and NZD/USD gaining 0.41% to trade at 0.8247.

Sentiment on the commodity linked currencies had been hit earlier by concerns over a possible slowdown in the world’s second-largest economy after data over the weekend showed that inflation in China hit a 10-month high in February, while industrial output and retail sales slowed.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slipped 0.09% to 82.94.

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