Dollar Dives on Weak US Jobs Data as Hike Expectations Tumble

The US dollar experienced a decline against major currencies, including the yen and euro, after the release of weak US jobs data in July. The Labor Department reported that the US economy lost 23,000 jobs in July, contrary to economists' expectations for an increase of 80,000 jobs.

This unexpected decline in employment numbers fueled concerns about the strength of the US economy and dampened market expectations for a Federal Reserve interest rate hike. As a result, the dollar's value fell against the yen, shedding gains made in recent days following the historic intervention between Japanese and US authorities last week.

The dollar was last down 0.57% to 157.56 yen but remains on track for a weekly gain of about 0.10%. The euro also rose against the dollar, increasing by 0.39% to $1.1568 and targeting a weekly gain of 0.41%

The market's reduced expectations for a Fed hike are reflected in the CME's FedWatch tool, which shows that markets now put a 56% chance that the Fed will hold rates steady in September, up from 45% a day earlier.