The dollar took a breather Friday, relenting after dramatic rally that drove the U.S. currency to its highest in more than 4 years.
Traders struggled to assess a mixed U.S. jobs report and a slew of speeches from Federal Reserve officials including Chairman Janet Yellen.
Data from the U.S. Labor Department showed non-farm payroll employment to have risen by 214,000 jobs in October following an upwardly revised increase of 256,000 jobs in September.
Economists had expected employment to climb by about 235,000 jobs, compared to the addition of 248,000 jobs originally reported for the previous month.
The unemployment rate hit its lowest level since July 2008, dropping down to 5.8 percent in October, from 5.9 percent a month earlier.
Meanwhile, speaking in Paris today, Fed Chair Yellen shed little light on when the central bank will raise interest rates.
“I continue to anticipate that the headwinds associated with the financial crisis will wane. As employment, economic activity, and inflation rates return to normal, monetary policy will eventually need to normalize too, although the speed and timing of this normalization will likely differ across countries based on differences in the pace of recovery in domestic conditions,” Yellen said.
New York Fed President William Dudley said rates are set to rise next year, as markets have grown to expect.
“If all goes according to our forecast and the U.S. economy continues to make progress towards the Fed’s dual mandate goals of maximum sustainable employment and 2% inflation, the Federal Reserve will likely begin to raise its federal funds rate target off the zero lower bound sometime next year,” he said, also in Paris.
The dollar gradually weakened after those remarks, slipping to $1.2440 from a 26-month high of $1.2360 versus the euro. Relatively upbeat German factory data put a floor under the euro.
Mid-day losses took the buck to Y114.50 versus the yen, down a bit from this morning’s 7-year peak near Y116.
The dollar held near a 10-month peak around $1.59 versus the sterling.