The dollar rose against other major currencies on Friday, maintaining gains that followed the release of data showing the U.S. economy created far more jobs than expected in October. The surprisingly robust jobs report helped the dollar solidify a case for the Federal Reserve to increase U.S. overnight borrowing costs for the first time since 2006, a move that would strengthen the greenback and attract investors. Nonfarm payrolls increased 271,000 last month, the largest rise since December and a far cry from the 142,000 and 136,000 jobs numbers seen in September and August. Market economists polled by Reuters had predicted 180,000 new jobs for October. The data sent the dollar higher across the board. The greenback hit highs of 2.5-months versus the yen, seven months against the Swiss franc and 6.5 months against the euro.
The Canadian dollar hit its weakest level against the U.S. dollar since Oct. 1 after robust U.S. jobs data eclipsed an election-enhanced jump in Canadian jobs, with soft oil prices and the Keystone pipeline rejection also weighing on the currency. Canada added 44,000 jobs in October, its biggest gain in five months, while the 271,000 rise in U.S. nonfarm payrolls raised expectations of a December interest rate hike by the U.S. Federal Reserve. The Canadian data included an increase of 32,000 positions in the public administration sector, coinciding with temporary hiring related to the federal election.
Gold prices will likely break through key technical support and hit their lowest in nearly six years after notching up the biggest weekly loss in more than two years as investors braced for the first U.S. interest rate hike in years next month. On Friday, spot gold XAU= fell more than 1 percent to a three-month low at $1,084.90 an ounce after U.S. data showed job growth surged in October, extending its move into technically oversold territory on the 14-day relative strength index.