* U.S. jobs gains in June beat economists' expectations
* Wage growth remained tepid in June
* Euro hurt by weak German industrial orders
(Adds Fed report to Congress; updates prices)
By Karen Brettell
NEW YORK, July 5 (Reuters) - The U.S. dollar gained against
a basket of currencies to its highest levels in 2-1/2 weeks on
Friday after data showed that U.S. job growth rebounded strongly
in June.
Non-farm payrolls increased by 224,000 jobs last month, the
most in five months, and well above the 160,000 jobs forecast by
economists. The strong gains came after job growth slowed sharply in
May. The economy created 11,000 fewer jobs in April and May than
previously reported, the government said on Friday.
"You look at the U.S. number for today and there's quite a
bit of sticker shock with that," said Bipan Rai, North America
head of fx strategy at CIBC Capital Markets in Toronto. “We
think the sticker shock and thin liquidity is enough to drive
the dollar a little bit firmer for today.”
The data came as many traders and investors were away, a day
after the July 4 holiday and ahead of the weekend.
The dollar index, which measures the greenback against a
basket of six major currencies, was last at 97.311, up 0.56%,
after earlier rising to 97.443, the highest level since June 19.
Moderate wage gains in June, however, added to evidence that
the economy is slowing while the increase in jobs was not enough
to offset weakness in May.
”You did get a massive upside surprise but again that's
coming after a month in which you had a massive downside miss,"
Rai said. "If you take the two numbers together you are still
averaging at a clip that's slower than prior years' growth."
Average hourly earnings rose 6 cents, or 0.2%, after gaining
0.3% in May. That kept the annual increase in wages at 3.1% for
a second straight month.
The dollar has weakened from a two-year high reached in May
on growing expectations that the Federal Reserve is closer to
cutting interest rates.
U.S. economic growth continued "at a solid pace" in the
first half of the year though it likely weakened in recent
months as higher tariffs depressed global trade and business
investment weakened, the Fed said on Friday in its semi-annual
report to Congress. The euro also came under pressure on Friday after data
showed that German industrial orders fell far more than expected
in May, and the Economy Ministry warned that this sector of
Europe's largest economy was likely to remain weak in the coming
months. A relentless slide in European government bond yields has
forced investors to look for higher-yielding assets elsewhere,
which is holding back a sustained euro rally against the
greenback.
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Currency bid prices at 2:18PM (1818 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1218 $1.1284 -0.58% -2.19% +1.1287 +1.1208
Dollar/Yen JPY= 108.5700 107.7900 +0.72% -1.53% +108.6100 +107.7900
Euro/Yen EURJPY= 121.81 121.67 +0.12% -3.49% +121.9200 +121.6100
Dollar/Swiss CHF= 0.9926 0.9850 +0.77% +1.14% +0.9931 +0.9846
Sterling/Dollar GBP= 1.2520 1.2576 -0.45% -1.86% +1.2587 +1.2482
Dollar/Canadian CAD= 1.3091 1.3050 +0.31% -4.00% +1.3136 +1.3045
Australian/Dollar AUD= 0.6974 0.7019 -0.64% -1.06% +0.7029 +0.6958
Euro/Swiss EURCHF= 1.1135 1.1114 +0.19% -1.06% +1.1147 +1.1110
Euro/Sterling EURGBP= 0.8958 0.8969 -0.12% -0.29% +0.8984 +0.8959
NZ Dollar/Dollar NZD= 0.6619 0.6686 -1.00% -1.46% +0.6694 +0.6603
Dollar/Norway NOK= 8.6231 8.5308 +1.08% -0.18% +8.6385 +8.5277
Euro/Norway EURNOK= 9.6744 9.6278 +0.48% -2.34% +9.6831 +9.6237
Dollar/Sweden SEK= 9.4340 9.3206 +0.57% +5.25% +9.4628 +9.3198
Euro/Sweden EURSEK= 10.5830 10.5230 +0.57% +3.11% +10.6067 +10.5177
(Editing by Bill Trott and Leslie Adler)