Dollar Pressured by Mixed US Labor News

Core Insights - The dollar index fell from a 5.5-month high, closing down by -0.04% due to mixed economic signals from the US labor market and expectations of potential interest rate cuts by the Federal Reserve [1] Labor Market Data - US September nonfarm payrolls increased by +119,000, significantly surpassing expectations of +51,000, indicating a stronger labor market [3] - The September unemployment rate unexpectedly rose by +0.1% to 4.4%, marking a nearly four-year high, which suggests some weakness in the labor market [3] - Weekly initial unemployment claims decreased by -8,000 to 220,000, better than the anticipated 227,000, reflecting a stronger labor market [2] - However, continuing claims rose to 1.974 million, the highest in four years, indicating challenges for those laid off in finding new employment [2] Economic Indicators - The average hourly earnings in September remained unchanged from August at +3.8% year-over-year, which was stronger than the expected +3.7% [3] - The November Philadelphia Fed business outlook survey increased by +11.1 to -1.7, but this was weaker than the expected +1.0 [3] - Existing home sales in October rose by +1.2% month-over-month to an 8-month high of 4.10 million, exceeding expectations of 4.08 million [4] Federal Reserve Commentary - Recent comments from Federal Reserve officials were hawkish, indicating caution regarding interest rate cuts due to ongoing inflation concerns [5] - Cleveland Fed President expressed that lowering interest rates could prolong elevated inflation and encourage risk-taking in financial markets [5] - Chicago Fed President noted that inflation appears stalled or possibly rising, which raises concerns about preemptively cutting interest rates [5] - Fed Governor highlighted concerns about inflation remaining around 3%, emphasizing the need for caution in considering further interest rate cuts [5]