The US dollar rose in the European market on Monday against a basket of global currencies, maintaining its gains for the second day in a row, on the verge of touching the highest level in three weeks, amid activity in currency purchases as the best available investment.

Strong data on the labor market in the United States led to a decline in the possibility of cutting US interest rates early next year, and strengthened the hypothesis that the Federal Reserve will keep interest rates high for as long as possible in 2024.

US dollar index

The dollar index rose by 0.2% to the level of 104.21 points, from the opening level of today’s trading at 103.98 points, and recorded the lowest level at 103.93 points.

On Friday, the index achieved an increase of 0.35%, the fourth gain in the last five days, and recorded the highest level in three weeks at 104.26 points, after strong data on the labor market in the United States.

The US dollar index achieved an increase of about 0.8% last week, the first weekly gain in a month, thanks to purchases from low levels, and after the release of better than expected data from the largest economy in the world.

American labor market

Data on Friday showed that the US economy added about 199,000 new jobs during November, exceeding market expectations of 184,000, and the economy added about 150,000 jobs in non-agricultural sectors in October.

The unemployment rate fell to 3.7% in November from a rate of 3.9% in October, better than the expected rate of 3.9%, and the average hourly wage rose by 0.4%, exceeding market expectations for a rise of 0.3%, and the average recorded an increase of 0.2%. In October.

American interest

Following these data, the pricing of futures contracts for the possibility of cutting US interest rates by about 25 basis points during the March 2024 meeting fell from 60% to 40%, and the pricing of futures contracts for the possibility of cutting interest rates by about 25 basis points during the May meeting from 85% to 75%.

In order to re-price the above contracts, traders are awaiting this week the release of key inflation data in the United States for November, in addition to the activities of the Federal Reserve’s last monetary policy meeting this year.