The dollar appreciated yesterday following data that indicated U.S. jobs growth was slower than anticipated, implying that the Federal Reserve may opt to maintain interest rates at their current levels later this month. The unemployment rate decreased to 4.4% last month, down from a revised 4.5% in November, according to the U.S. Labor Department’s report on Friday, while employers also added 50,000 jobs during the month. Economists had predicted an increase of 60,000. The most recent job market data seems to provide the central bank with some flexibility to maintain short-term borrowing costs at their current levels, as Federal Reserve Chair Jerome Powell indicated last month that policymakers are likely to adopt this stance, at least for the immediate future. Financial markets had been preparing for a potential Supreme Court ruling that might invalidate President Donald Trump’s extensive tariffs. However, the court will refrain from issuing that ruling on Friday; nonetheless, a decision may still be anticipated next week. According to data, the U.S. economy experienced an addition of 50,000 jobs in December. The figure fell short of the anticipated rise of 60,000 jobs projected by economists.

The dollar increased by 0.2% to 0.801 against the Swiss franc, on track for its second consecutive week of gains. The dollar index increased by 0.25% to 99.13, positioning itself for a second consecutive week of gains.”In real life, the standard error margin for non-farm payrolls is 20,000, and I don’t think the market is going to pay much attention to this,” stated Steve Englander. The implied probability that the central bank will maintain interest rates at its upcoming two-day meeting on January 27 and 28 is currently at 95%, according to the reports, an increase from 68% a month prior.

The Japanese yen experienced a decline after a report indicated that Prime Minister Sanae Takaichi is contemplating a snap election for the lower house of parliament in early February. Data indicated that Japanese household spending unexpectedly increased in November compared to the previous year, suggesting that consumption gained momentum prior to the Bank of Japan raising its policy rate to a 30-year high in December. “This means an April BoJ hike ‘could’ happen technically, as the assumption was that a spring election would mean no chance of a BoJ move until after the event. However, Takaichi will likely not be pleased to see a faster pace than every six months either. She’ll regain more power within the LDP and will be able to suppress internal opposition from hawks more,” stated Jordan Rochester. The dollar reached a one-year peak of 158.185 against the yen. It was last up 0.64% to 157.88 yen, indicating a potential for the second consecutive week of gains.

In Europe, German exports unexpectedly declined in November as shipments to other EU countries and the U.S. decreased, while industrial output increased contrary to expectations of a downturn. The euro experienced a decline of 0.2%, trading at $1.1635, positioning itself for a consecutive week of losses against the dollar. Meanwhile in China, annual consumer price inflation accelerated in December to its highest level in nearly three years. The dollar experienced a decline of 0.06%, settling at 6.977 against the offshore Chinese yuan. The pound sterling experienced a decline of 0.24%, trading at $1.3403, while the Canadian dollar saw a decrease of 0.32% against the US dollar, valued at C$1.391 per dollar. The Australian dollar experienced a decline of 0.13% against the US dollar, settling at $0.6688. Meanwhile, Bitcoin saw a decrease of 1.05%, now priced at $90,247.14.