US Dollar Adds to Weekly Loss Amid Slowest Employment Growth Since May

The US dollar maintained its downward trend to finish the trading week after the US government reported the slowest employment growth rate since May. The disappointing November jobs report coincided with a resurgence in coronavirus cases, as well as jurisdictions imposing new lockdown measures. The lackluster labor snapshot did not hit the financial markets, adding to the traditional safe-haven asset’s 2020 woes.

According to the Bureau of Labor Statistics (BLS), the US labor market added 245,000 new jobs in November, falling short of the market forecast of 469,000 new positions. This is down from the 610,000 new jobs that were created in October.
The unemployment rate was 6.7% last month, coming in better than the median estimate of 6.8%. In October, the jobless rate was 6.9%.
In November, average hourly earnings ticked up 0.3%, average weekly hours were unchanged at 34.8, and the labor force participation rate slipped 61.5%.
Most of the job gains were seen in transportation and warehousing, with 145,000 added positions. This was driven by companies hiring messengers, couriers, and storage and warehousing workers ahead of the holiday season.
Overall, this is the slowest monthly employment growth since the labor recovery began in May. US coronavirus infections topped 100,000 per day last month, adding to the total number of 14.2 million cases. Despite three mostly effective coronavirus vaccines coming to market over the next several months, many states and municipalities are instituting new restrictions to stop the spread of COVID-19, a move that has hurt businesses across the country.
In other economic data, the trade deficit widened to $63.1 billion in October as exports rose 2.2% to $182 billion, while imports increased 2.1% to $245.1 billion, reported the Bureau of Economic Analysis (BEA).
Financial markets barely reacted to the news in pre-market trading. The Dow Jones Industrial Average rose a little more than 100 points, and the S&P 500 and the Nasdaq Composite Index were relatively flat.
The US Dollar Index, which gauges the greenback against a basket of currencies, recorded a tepid loss in early trading. The DXY dipped 0.06% to 90.66, from an opening of 90.71. The index will post a weekly decline of about 1.2%, raising its year-to-date drop to 5.95%.
The USD/CAD currency pair fell 0.29% to 1.2827, from an opening of 1.2865, at 13:15 GMT on Friday. The EUR/USD rose 0.07% to 1.2157, from an opening of 1.2146.
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