The dollar fell against most of its rivals on Friday after US employment data disappointed investors looking for signs of a strengthening economy.
Monthly non-farm payrolls data showed that just 138,000 jobs were created in May, down from 174,000 in April – which was a significant downward revision – and missing expectations of 185,000.
Unemployment rate falls
The unemployment rate, however, surprisingly dipped further to a 16-year low of 4.3%, from 4.4% in April.
Wage growth was weaker than expected, with average hourly earnings unchanged from April's figure of 2.5%, defying forecasts of a rise to 2.6%.
Markets reacted with losses, although the main stock indexes held their ground, on rising expectations that the Federal Reserve will hold back from further rate hikes following the widely-anticipated quarter-point rate increase this month.
The dollar fell 0.6% against the euro to $1.1276, and lost 0.8 per cent to Y110.48 versus Japan's yen.
“High expectations – both for this jobs report and for a June rate hike – had been priced into the dollar this week, so there was only one way it could have moved in response to the jobs data – and that was down," said David Lamb at FEXCO Corporate Payments.