US Job Market
US non-farm payrolls expand much more than expected in May REUTERS

The US dollar jumped against most major currencies after Friday's labour market data showed non-farm employers added much more jobs to the roll than expected in May.

The rise in unemployment rate failed to arrest the US currency's surge though it traded choppy against the Canadian dollar as the employment change details from the Northern neighbour too came in much better than expected.

Against the Japanese yen, the greenback soared to a new 13-year high of 125.65 from 124.80 where it was trading at the time of the data release. EUR/USD slumped to 1.1087 from 1.1222 following the data.

The payroll addition in the non-farm sector was 280,000, much more than April's 221,000 and far outsmarting the forecast of 225,000. Also, the average hourly earnings rate increased 0.3% on a month-on-month basis from 0.1% in April beating market expectations of 0.2%.

The unemployment rate meanwhile rose to 5.5% from 5.4% when the market consensus was for a repeat.

In Canada, net change in employment was an addition of 58,900 in May compared to a drop of 19,700 in April and market expectations of 10,000 addition. This happened with a rise in the participation rate to 65.9% from 65.8% which analysts thought would repeat.

Canada's unemployment rate, however, was steady at 6.8%.

USD/CAD added 50 pips quickly from near 1.2500 to trade as high as 1.2550 after the US numbers were out. It soon fell back as Canadian numbers were digested and shed 50 pips to trade near 1.2450 but bounced back again and held near 1.2490 a few minutes after the data.

The UK pound fell more than 100 pips to 1.5223, reversing most of the gains made since Tuesday. The GBP/USD pair was down 0.9% on the day at the low, increasing its likelihood to hit lows below the one-month low of 1.5170 hit on 1 June.