Strong Payrolls Spark USD Rally as Fed Rate Hike Bets Revive
The US dollar gained strength towards the end of last week following the release of unexpectedly strong non-farm payroll figures. The data showed that the economy added 162,000 jobs in August, exceeding forecasts for an increase of 56,000.
This development has revived bets on a Federal Reserve rate hike later this month, as continued resilience in the US labour market is seen as a positive signal for interest rates.
In contrast to the strong performance of the US dollar, other major currencies struggled. The Canadian dollar weakened after Canada's employment figures revealed an unexpected contraction in employment growth last month, while the Australian dollar rose slightly on reports that Beijing plans to inject billions into state-owned insurers and banks.