Dollar Jumps to Seven-Year High on Strong Jobs Report

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Dollar Jumps to Seven-Year High on Strong Jobs ReportThe dollar touched a seven-year high against the yen, as the U.S. economy showed signs of growing stronger while midterm elections resulted in Republicans controlling the Senate.

The greenback rose 0.9 percent to trade at 114.65 yen at 11:49 a.m. in New York after jumping to 114.84, its highest level since November 2007. The dollar rose 0.5 percent to $1.2485 per euro as the yen dropped 0.3 percent to steady at 143.02 per euro.

The Roseland, New Jersey-based ADP Research Institute reported that employers absorbed 230,000 workers last month, beating the average estimate of 220,000 in a Bloomberg poll.

“The Fed is keen to normalize next year and, if data continues to come in strong and good, they’ll have scope to do that,” Brad Bechtel, a Stamford, Connecticut-based managing director of Faros Trading LLC, told Bloomberg News. “It’s always been a risk-positive kind of thing whenever Republicans re-gain control of the government because they have more market-friendly policies.”

Meanwhile, the Australian dollar touched the weakest level since July 2010 after iron ore prices touched the lowest point in over five years after some Chinese steel mills were ordered to reduce output. Iron ore is Australia’s key export, while China is the world’s biggest iron ore consumer. The Aussie fell 1.8 percent to 85.84 U.S. cents.

The Norwegian krona rebounded from the lowest level since March 2009 after oil prices recovered from their weakest level in four years. The krona rose 0.5 percent to trade at 6.8261, halting a three-day run of declines. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com