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Forex - EUR/USD extends gains after U.S. jobs data

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Investing.com - The euro extended gains against the U.S. dollar on Friday, after the release of downbeat U.S. nonfarm payrolls data painted a mixed picture of the strength of the U.S. job market's recovery, weighing on the greenback.

EUR/USD hit 1.3279 during European afternoon trade, the session high; the pair subsequently consolidated at 1.3277, gaining 0.54%.

The pair was likely to find support at 1.3166, the low of July 25 and resistance at 1.3311, Thursday's high.

The Bureau of Labor Statistics said the U.S. economy added 162,000 jobs in July, disappointing expectations for a 184,000, after an increase of 188,000 the previous month.

The private sector added 161,000 jobs last month, less than the expected 189,000 increase, after 196,000 jobs were created in June.

However, the report also showed that the U.S. unemployment rate ticked down to 7.4% in July, from 7.6% the previous month. Analysts had expected the unemployment rate to slip to 7.5% last month.

The data came amid growing uncertainty over the future of the Federal Reserve's stimulus program, after the central bank said on Wednesday that it would keep buying USD85 billion a month in mortgage and Treasury securities and gave no hint of plans to pare its bond-buying program.

In the euro zone, official data earlier showed that the number of unemployed people in Spain fell for the fifth consecutive month in July, declining by 64,900 after a 127,200 fall the previous month.

Analysts had expected the number of unemployed people to fall by 80,000 last month.

The euro was lower against the pound with EUR/GBP shedding 0.42%, to hit 0.8700.

Also Friday, Markit research group said the U.K. construction purchasing managers' index rose to 57.0 in July, from a reading of 51.0 the previous month, blowing past expectations for a rise to 51.5 and expanding at the fastest pace since July 2010.

A separate report showed that house price inflation in the U.K. rose 0.8% last month, more than the expected 0.4% gain, after an increase of 0.3% in June.

Later in the day, the U.S. was to release a report on factory orders.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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