Investing.com - The dollar strengthened against the euro and the yen on Friday after a robust U.S. jobs report for November bolstered expectations that the Federal Reserve will hike interest rates later this month.
The Labor Department reported that the U.S. economy added 211,000 jobs last month, after increasing an upwardly revised 298,000 in October.
The unemployment rate held steady at 5% in November. Economists had forecast jobs growth of 200,000 and no change in the unemployment rate.
The report hardened expectations that the Fed will hike interest rates for the first time since 2006 at its upcoming meeting on December 15-16. Higher U.S. interest rates would make the dollar more attractive to yield-seeking investors.
The dollar rose against the euro, with EUR/USD down 0.56% to 1.0880 in late trade. The pair still ended the week with gains of 2.81%.
The single currency was also pressured lower after European Central Bank President Mario Draghi said Friday the ECB would step up stimulus measures if necessary to bring inflation back to target.
The remarks came one day after the euro posted its largest one-day gain against the dollar in more than six years, jumping 3% after the latest easing measures announced by the ECB fell short of market expectations.
The ECB cut the deposit rate to -0.3% and extended the duration of its bond-buying program, falling short of expectations for a more significant move.
The dollar was higher against the yen, with USD/JPY up 0.44% to 123.1 late Friday.
The greenback also gained ground against the pound and the Swiss franc, with GBP/USD sliding 0.21% to 1.5112 and USD/CHF up 0.33% to 0.9966.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, advanced 0.46% to 98.27, holding below the seven-and-a-half month peaks of 100.6 set on Thursday. The index ended the week down 1.73%.
In the week ahead, investors will be looking ahead to Friday’s U.S. data on retail sales and inflation for fresh indications on the strength of the economy.
Central bank meetings in the U.K., Switzerland and New Zealand will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, December 7
The Swiss National Bank is to publish data on its foreign currency reserves. This data is closely scrutinized for indications of the size of the bank’s operations in currency markets.
Bank of England Governor Mark Carney is to testify before the European Parliament Committee on Economic and Monetary Affairs, in Brussels.
Tuesday, December 8
Japan is to release revised data on third quarter economic growth, as well as data on the current account.
Australia is to publish private sector data on business confidence.
The U.K. is to produce data on industrial production.
Canada is to release data on building permits. Later in the day, Bank of Canada Governor Stephen Poloz is to speak at an event in Toronto.
Wednesday, December 9
Australia is to release data on consumer sentiment.
Japan is to publish data on core machinery orders.
China is to producer data on both consumer and producer price inflation.
The Reserve Bank of New Zealand is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Thursday, December 10
Australia is to publish the monthly employment report.
The SNB is to announce its benchmark interest rate and publish its monetary policy assessment, which outlines economic conditions and the factors affecting the monetary policy decision. The announcement is to be followed by a press conference.
The U.K. is to release data on the trade balance.
Later, the BoE is to announce its benchmark interest rate and publish the minutes of its monetary policy meeting.
The U.S. is to release the weekly report on initial jobless claims.
Friday, December 11
The U.S. is to round up the week with reports on retail sales, producer price inflation and preliminary data on consumer sentiment.