Dollar near one-month low as weak US jobs data continues to weigh

The US dollar held near Friday's lows early Monday (6 April) in Asia as the impact of the negative surprise in US non-farm payrolls continued to weigh. Most European markets are closed on the day for Easter Monday.

The EUR/USD traded up to 1.1019 from the previous close of 1.0978. On Friday, the pair had risen to as high as 1.1028, a shade below the 26 March high of 1.1058, which was its highest since 5 March.

The US dollar index has dropped to 96.59 from Friday's close of 96.74. On the day of the jobs report, the index had fallen to 96.40, which was not far away from the near three-week low of 96.17 touched on 26 March.

US employers added only 126,000 jobs in March, breaking a year-long run of above 200,000 monthly job additions. The March number was way below the consensus estimate of 245,000 and compared to the February figure of 201,000.

The dollar fell on the jobs data as it intensified speculation about the US central bank's rate move. The market is now expecting the Fed to announce its first rate increase since 2006 by around September. The Fed rate target has been near zero since 2008.

Analysts do not see the March data as a signal for a slowdown in job growth in the US but they think the probability of such a decline has increased.

While no data has been scheduled for the eurozone or the UK on Monday as it is a holiday in the region, the services PMI data by ISM and Markit's composite PMI will be some US numbers to be watched. Another US number of importance will be the Labour Conditions index for March.

A speech by New York Fed President William Dudley scheduled later in the day will also be watched especially in the background of the disappointing data on Friday.