US Dollar Slides After June Jobs Report Badly Misses Forecast
June non-farm payrolls rose just 57K against a 110K estimate, hammering the dollar and scrambling pre-holiday market moves.
The US dollar fell sharply Thursday after June non-farm payrolls came in at just 57,000 — roughly half the 110,000 economists had expected — rattling currency and bond markets in thin pre-holiday trading ahead of America's 250th Independence Day celebration. The yen led all major currencies higher as USD/JPY briefly touched 160.65 before clawing back to 161.14, with Japanese officials suspected of conducting stealth intervention to support their currency.
The weak payrolls number initially triggered a classic risk-off playbook: dollar selling, a bond rally, and a brief equity bounce. But the moves faded quickly, with the S&P 500 finishing down 0.3% as holiday-thinned flows muddled the signal. Gold surged $83 to $4,113, and US 10-year Treasury yields barely budged, edging just one basis point higher to 4.48%.
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The report raised more questions than it answered. Job creation fell dramatically short despite a two-year high in the JOLTS openings data released earlier in the week — a contradiction traders found hard to reconcile. Adding to the confusion, hospitality sector employment posted large losses just weeks before the World Cup kicks off on US soil, a counterintuitive result that may explain why the initial market reaction quickly petered out.
Fed officials appeared unfazed. San Francisco Fed President Mary Daly noted that US investment growth remains "exceedingly strong," a framing that suggests the central bank is in no hurry to pivot from its broadly neutral policy stance. The soft payrolls print reduces pressure on the Fed to act in either direction, reinforcing expectations for an extended hold. The euro initially spiked to a session high of 1.1472 before surrendering roughly 40 pips as dollar weakness proved short-lived.
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