The US dollar recorded a sharp decline against other major currencies in Tuesday trading after the announcement of delayed economic data due to the 'government shutdown', the report showed stronger-than-expected job growth.
At 10 am, the US Dollar Index (DXY) that measures the US dollar was at 98.260 points, up slightly 0.5% since it opened in early trading Wednesday in the Asian session.
The US economy recorded an increase of 64,000 jobs in November, exceeding market analysts' estimates. This performance came after the economy recorded a reduction of 105,000 jobs in October, according to data from the US Labor Department.
The jobs report was released late due to the 43-day US federal government shutdown, which previously delayed the release of official data.
While the employment data showed signs of a modest recovery, the overall picture of the labor market remains mixed.
The unemployment rate rose to 4.6% from 4.4% previously, raising concerns about the resilience of the US labor market ahead of the Federal Reserve's (Fed) policy meeting in January.
Market expectations also reflected a shift in monetary policy sentiment, with Fed funds futures showing a probability of around 75.6% for a rate hike at the next meeting on January 28. This is up from around 70% the previous week, according to CME Group's FedWatch tool.
Traders' focus now shifts to a series of key economic data releases due later this week, particularly Initial Jobless Claims and the Consumer Price Index (CPI) inflation report, which are expected to provide a clearer indication of the Fed's next policy direction.
