USD Weakens Amid Surprise Payrolls Decline

The US Dollar weakened on Friday after a surprise decline in US payrolls, causing the USD/CHF pair to drop to around 0.8080, down 0.53% on the day.

The US economy lost 23K jobs in July, falling short of economists' expectations of an increase of 80K. The June employment gain was also revised downward from 57K to 20K.

Despite the decline in payrolls, the Unemployment Rate fell to 4.1% from 4.2%, with Richmond Fed President Thomas Barkin stating that the jobs data were 'more low hire, low fire' and consistent with a sector in weak balance.

The Federal Reserve (Fed) rate hike expectations at the September meeting dropped to around 42% from 54% immediately before the release, according to the CME FedWatch Tool. Analysts at OCBC expect CHF weakness to persist into year-end due to carry trade funding pressures and a potential cooling effect on inflation.