The US Dollar strengthened during the Good Friday trading session, driven by a better-than-expected jobs report. The US economy saw the largest number of new jobs in seven months and blowing past payroll expectations, sending Treasury yields higher. When US markets reopen on Monday, how will investors react to the stellar numbers?

According to the Bureau of Labor Statistics (BLS), the US economy added 916,000 new jobs in March, the strongest employment growth since August. This is up from the upwardly revised 468,000 new positions in February. The market had penciled in a gain of 647,000.

The unemployment rate dropped to 6%, down from 6.2%, in March. This is the lowest jobless rate in more than a year. However, as the Department of Labor noted, the official jobless rate does not consist of the more than four million Americans who lost their jobs in 2020 and left the labor force.

Gains in the non-farm payrolls report were led by leisure and hospitality (280,000), construction (110,00), professional and business services (66,000), manufacturing (53,000), and transportation and warehousing (48,000). Government payrolls also added 136,000.

Average hourly earnings dipped 0.1% in March, average weekly hours rose to 34.9, and the labor force participation rate edged up to 61.5%.

The January and February figures were revised up by a combined 156,000: 67,000 to 233,000 in January and 89,000 to 468,000 in February.

Despite the impressive employment report, the economy is still short a little more than eight million jobs that were around in February of last year. That said, a growing number of states lifting coronavirus-related restrictions, a broader decline in new COVID-19 infections, and warmer weather were some of the leading factors for the monster jobs report in March. Moreover, the enormous federal stimulus efforts that include $1,400 checks for most US households, adding more money to people’s pockets.

The bond market was green across the board, with the benchmark ten-year Treasury yield up 0.023% to 1.702%. The one-year bill rose 0.003% to 0.066%, while the 30-year bond advanced 0.015% to 2.355%.

The US Dollar Index (DXY), which measures the greenback against a basket of currencies, climbed 0.03% to 92.95, from an opening of 92.89. The index is poised to record a 0.2% weekly gain, adding to its year-to-date gain of 3.4%.

The USD/CAD currency pair slipped 0.01% to 1.2547, from an opening of 1.2548, at 13:04 GMT on Friday. The EUR/USD fell 0.09% to 1.1768, from an opening of 1.778.

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Post tags: Bonds, Coronavirus, Dollar, DXY, EUR/USD, Jobs, Unemployment, United States, US Dollar Index, USD/CAD

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