NEW YORK: The US dollar was down on Friday but trimmed some losses against the euro and yen after data showed the world’s largest economy added more new jobs than expected last month, reflecting a labor market that remained on stable footing.
The report reinforced expectations that the Federal Reserve will hold interest rates steady for the next few meetings and not cut them until probably the summer.
US data showed nonfarm payrolls increased by 177,000 jobs last month after rising by a downwardly revised 185,000 in March. Economists polled by Reuters had forecast 130,000 jobs added last month after a previously reported 228,000 gains in March.
The report, however, does not reflect the full impact of the tariffs imposed on the so-called Liberation Day on April 2. Economists expect jobs growth to slow or even contract in the coming months once the fallout from the punitive tariffs is taken into account.
“The data for this release was collected during the week following Liberation Day, meaning it would be too soon to expect substantial fallout to emerge just as higher tariffs were being implemented,” wrote Jeff Schulze, head of economic and market strategy at ClearBridge Investments, in emailed comments.
“As a result, investors are likely to look through this positive print, viewing it as a ‘calm before the storm’ with strength being downplayed given the known headwinds that the labor market will be facing in the coming months.”
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