The dollar weakened on Friday following the release of the U.S. jobs report for February. The report, which exhibited a slowdown in job growth, indicated a slowdown in inflation, which in turn could lower the possibility of a 50 basis point interest rate hike by the Federal Reserve this month.
Nonfarm payrolls increased by 311,000 last month, lower than the addition of 504,000 jobs in January. Initially, job growth in January was believed to be 517,000 before being revised lower.
As a result of the decline in new payrolls, futures for fed funds showed a 38.4% chance that the Federal Reserve would implement a 50 basis point interest rate hike on March 22; a sharp decline in probability than was previously given.
The dollar index, which weighs the greenback against a basket of major currencies, fell 0.475%, while the euro strengthened against the dollar by 0.51%, now at $1.0634. The pound was up 0.94% to $1.2037.