US Dollar Stalls As Economy Creates 4.8 Million Jobs in June, Factory Orders Surge

The US dollar is stalling against many of its G10 currency rivals on Thursday after a strong and better-than-expected June jobs report. The stellar labor reading sparked a rally in the stock market, raising the risk tolerance of traders in equities. After the last couple of weeks of investors being spooked by a resurgence in coronavirus cases, the millions of new jobs suspended these fears for now.

According to the Bureau of Labor Statistics (BLS), the US economy created 4.8 million new jobs in June, beating the market forecast of three million. The unemployment rate fell to 11.1% last month, coming in better than the median estimate of 12.3%.
This is a continuation of the strong May jobs report that saw 2.699 million new jobs and a jobless rate of 13.3%.
The biggest employment gains were concentrated in leisure and hospital (2.088 million), retail (739,800), education and health services (568,000), professional and business services (306,000), and manufacturing (356,000). Government payrolls picked up just 33,000.
The US government also reported that the labor force participation rate rose to 61.5%, average weekly hours dipped to 34.5, and average hourly earnings slipped 1.2%.
In a separate labor report, the number of Americans filing for first-time unemployment benefits clocked in at 1.427 million in the week ending June 27, worse than the 1.355 million projection.
Continuing jobless claims totaled 19.29 million, while the four-week average, which eliminates the week-to-week volatility, topped 1.503 million.
In other economic data, the balance of trade worsened to -$54.6 billion in May as exports fell to $144.5 billion and imports dipped to $199.1 billion.
In May, new orders for US manufactured goods surged by 8%, falling short of market expectations of 8.9%. This is up from the 13.5% crash in April.
The two-year bond yield climbed 2.5 basis points to 1.458%, the benchmark 10-year Treasury yield rose 1.9 basis points to 0.701%, and the 30-year bond yield added 2.5 basis points to 1.463%.
Financial markets rallied on the good news as the leading stock indexes surged more than 1%. Gold continued to retreat after testing its best level in nine years.
The US Dollar Index, which measures the greenback against a basket of currencies, fell 0.17% to 97.03, from an opening of 97.15. The index is on track for a weekly gain loss of 0.4%, paring its year-to-date gain to below 0.7%.
The USD/CAD currency pair tumbled 0.12% to 1.3573, from an opening of 1.3587, at 14:03 GMT on Thursday. The EUR/USD rose 0.17% to 1.1272, from an opening of 1.1251.
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