2023.02.0620:58:00UTC+00Dollar Gains Against Major Counterparts On Interest Rate Bets

The U.S. dollar climbed higher against its major counterparts on Monday, amid rising possibility of the Federal Reserve holding interest rates higher for longer than previously expected after data showed jobs growth in the U.S. came in stronger than expected in the month of January.

A surge in U.S. service sector activity in the month of January contributed as well to the greenback's uptick.

Last week, the Labor Department's closely watched monthly jobs report said non-farm payroll employment soared by 517,000 jobs in January after surging by an upwardly revised 260,000 jobs in December.

Economists had expected employment to increase by 185,000 jobs compared to the addition of 223,000 jobs originally reported for the previous month.

The report also said the unemployment rate edged down to 3.4% in January from 3.5% in December. Economists had expected the unemployment rate to inch up to 3.6%.

A report from the Institute for Supply Management showed service sector activity in the U.S. rebounded by much more than expected in the month of January.

The ISM said its services PMI jumped to 55.2 in January from a revised 49.2 in December, with a reading above 50 indicating growth. Economists had expected the index to inch up to 50.4 from the 49.6 originally reported for the previous month.

Traders are likely to keep an eye on remarks by Federal Reserve Chair Jerome Powell on Tuesday.

After last week's interest rate increase, traders are likely to look to Powell's comments for additional clues about the outlook for further rate hikes.

The dollar index climbed 103.77 before easing a bit to 103.63, but still up firmly, gaining about 0.7%.

Against the Euro, the dollar firmed to 1.0726 from 1.0799.

The dollar is stronger against Pound Sterling at 1.2024, gaining from 1.2056.

Against the Japanese currency, the dollar strengthened to 132.63 yen, rising from 131.18 yen.

The dollar is up against Swiss franc, fetching CHF 0.9283 a unit, compared with CHF 0.9260 on Friday.

Against the Loonie, the dollar firmed to C$ 1.3478 before paring some gains. It is currently at C$ 1.3447, gaining more than 0.4%.