Dollar Slumps After Disappointing U.S. Jobs Data

The dollar index (DXY00) fell to a 2‑week low on Thursday, closing down 0.52%.

U.S. June nonfarm payrolls added only 57,000 jobs, below the 113,000 forecast, and May’s figure was revised down to 129,000 from the originally reported 172,000.

Average hourly earnings rose 0.3% month‑over‑month and 3.5% year‑over‑year, matching expectations.

Initial unemployment claims slipped by 1,000 to 215,000, beating expectations of a rise to 218,000.

May factory orders slipped 1.3% month‑over‑month, a smaller decline than the 2.0% drop analysts had anticipated, and orders excluding transportation rose 1.9%, the strongest increase in more than four years.

Swap markets currently price a 20% probability of a 25‑basis‑point rate hike at the upcoming FOMC meeting on July 28‑29.

The euro climbed to a 1.5‑week high against the dollar, appreciating 0.49%, as the greenback weakened after the weaker‑than‑expected June payroll report. The euro also found support from Eurozone data showing Italy’s unemployment rate unexpectedly fell to a record low.

Italy’s May unemployment rate dropped by 0.1 percentage point to a record low of 5.0%, defying expectations of no change.

Markets are pricing a roughly 4% chance that the European Central Bank will raise rates by 25 basis points at its July 23 policy meeting.

The yen slipped 0.92% against the dollar, falling to a two‑week low, after a Reuters report sparked speculation of possible Japanese intervention to support the currency.

Such intervention could be swift, with Japan’s Ministry of Finance potentially stepping in without prior warning to unwind speculative yen positions.

The risk of intervention is heightened, given recent statements by Japanese Finance Minister Satsuki Katayama and U.S. Treasury Secretary Scott Bessent indicating a willingness to take bold coordinated action if needed.

The BOJ is seen as having only a 2% chance of a 25‑basis‑point rate hike at its July 31 meeting.

August COMEX gold futures settled up 1.06% at $43.30, while September silver contracts rose 0.91%.

Gold and silver prices reached one‑week highs, buoyed by the dollar’s decline, reduced expectations of further Fed tightening, and lower inflation prospects following a drop in WTI crude to a four‑month low.

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