Dollar higher after US job growth tops expectations

Dollar higher after US job growth tops expectations

The U.S. Dollar Currency Index, which tracks the greenback against six other major currencies, was 0.2% higher at 101.91, after rising as high as 102.19 following the jobs report.

The better-than-anticipated job gain is another sign the economy is still strong, while wage growth is beginning to moderate amid a rebound in the labor force, Michael Pearce, a senior U.S. economist at Capital Economics, said in a note.

"With wage growth still running well above rates that are consistent with the Fed’s 2% inflation target, however, that won’t stop the Fed from continuing to raise rates by 50 basis points at the next meeting or two," Pearce said.

The Fed has raised interest rates by three quarters of a percentage point this year, and most Fed policymakers back raising interest rates another half of a percentage point at each of their next two meetings.

Calling high inflation the U.S. central bank's "number one challenge," Fed Vice Chair Lael Brainard on Thursday said she backs at least a couple more half-percentage-point interest rate hikes, with more on tap if price pressures fail to ease.

Investors have mixed views on the greenback, which is still close to two-decade highs against a basket of peers.

George Saravelos, global head