Dollar Stops Its Losses After a Labor Market Report

The US dollar is fluctuating around a consistent level against the euro today as the US currency halted its weekly slide following the release of labor market data.

The US Bureau of Labor Statistics published its report for October, which showed an increase in nonfarm payroll employment by 161,000 while unemployment rate remained unchanged at 4.9%. The dollar initially rose following the report before it gave up its gains and remained little changed as attention quickly returned to the US election race.

The greenback dropped for five days in a row as investors took shelter prior to the US presidential election, which increased demand for safe haven assets and currencies like gold, Japanese yen, and Swiss franc. The decreasing gap between Democratic presidential candidate Hillary Clinton and Republican Donald Trump in the race for the White House is draining trader’s appetite for the US currency as they prefer to wait for the result of the election that runs on November 8.

The political uncertainty is weighing down on the dollar even as chances of an interest rates raise by the Federal Reserve in December are increasing. Futures prices now show a 71.5% chance that the Federal Open Market Committee will decide to increase interest rates by 0.25% in its next meeting, according to the CME Group FedWatch tool.

EUR/USD traded at 1.1092 as of 15:42 after rising to 1.1113 at 14:16 GMT today. The pair started the week at 1.0988 on Monday before it steadily headed up to its current level.

The Dollar Index, which measures the performance of the US currency against a basket of major currencies, fell to 97.25 as of 13:36 GMT after rising to 97.32 at 12:35 GMT.

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