New York--The dollar soared Friday after a surprisingly strong US jobs report lifted expectations the Federal Reserve will raise interest rates as early as June.
Despite bad winter weather in February, the world's largest economy added 295,000 jobs, and the unemployment rate fell two-tenths to 5.5 percent, the lowest level since May 2008.
Wall Street stocks tumbled and Treasury yields jumped, confirming "that the focus for investors across the financial markets is now on tightening in June instead of September," said Kathy Lien of BK Asset Management.
The dollar surged to its highest level against the euro in 11 and a half years. The greenback traded at $1.0842 per euro around 2200 GMT, compared with $1.1028 a day earlier.
"The starkly different outlooks for monetary policy in Europe compared to the US have increasingly weighed on the euro to the benefit of the dollar," said Joe Manimbo of Western Union Business Solutions.
The Fed's policy arm, the Federal Open Market Committee, next meets on March 17-18, and could deliver a broad hint at that meeting that an increase in the Fed funds rate is forthcoming.
"The central bank's goal in March is to provide themselves with as much flexibility as possible without committing to a move," Lien said.
2200 GMT Friday Thursday
EUR/USD 1.0842 1.1028
EUR/JPY 130.95 132.50
EUR/CHF 1.0695 1.0744
EUR/GBP 0.7208 0.7236
USD/JPY 120.78 120.14
USD/CHF 0.9864 0.9742
GBP/USD 1.5042 1.5241
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