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Surge In U.S. Payrolls Underpins Dollar

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The U.S. dollar outperformed against its key counterparts in the European session on Friday, after the economy created more jobs than forecast in October, helping to reduce fears about an economic slowdown, following this week's signal of a pause in the easing cycle in the near term.

Data from the Labor Department showed that job growth beat forecasts in the month of October.

The Labor Department said non-farm payroll employment climbed by 128,000 jobs in October compared to economist estimates for an increase of about 89,000 jobs.

The report said the unemployment rate inched up to 3.6 percent in September from 3.5 percent in August. The uptick matched economist estimates.

Strong data came on the heels of this week's FOMC decision signaling a halt in its rate cutting spree in the near term.

The Institute for Supply Management is due to release manufacturing purchasing managers' index for October at 10:00 am ET. The index is expected to rise to 49 from 47.8 in September.

The Commerce Department is also set to publish construction spending data for September at the same time. Economists expect an increase of 0.2 percent from 0.1 percent in the previous month.

Federal Reserve Vice Chairman Richard Clarida will deliver a speech at a luncheon hosted by the Japan Society in New York at 1 pm.

Traders await developments in US-China trade front as China expressed doubts about striking a long-term trade deal with the U.S.

The currency fell against its most major counterparts in the Asian session, as upbeat data from China triggered a sell-off in safe-haven assets.

The greenback appreciated to a 2-day high of 0.9895 against the franc, up by 0.4 percent from a 10-day low of 0.9855 it recorded at 2:30 am ET. At yesterday's trading close, the pair was quoted at 0.9864. The currency is likely to face resistance around the 1.00 region, if it gains again.

Data from the Federal Statistical Office showed that Swiss consumer prices declined for the first time since late 2016 in October. Consumer prices decreased 0.3 percent on a yearly basis in October reversing a 0.1 percent rise in September.

Having declined to a 3-week low of 107.89 against the yen at 9:00 pm ET, the greenback bounced off to 108.26 after the data. The pair was worth 108.03 at Thursday's close. Further uptrend may take the greenback to a resistance around the 111.00 area.

Data from the Ministry of Internal Affairs and Communications showed that the unemployment rate in Japan came in at a seasonally adjusted 2.4 percent in September. That exceeded expectations for 2.2 percent, which would have been unchanged from the August reading.

The greenback was up by 0.4 percent at a 2-day high of 1.1128 against the euro, rebounding from a low of 1.1169 seen at 4:00 am ET. The greenback was trading at 1.1151 against the euro when it closed deals on Thursday. Continuation of the greenback's uptrend may lead it to a resistance around the 1.09 region.

After a decline to 1.2972 against the pound at 4:15 am ET, the greenback recouped some of its losses with the pair trading at 1.2935. The greenback is poised to challenge resistance around the 1.27 mark.

Survey data from IHS Markit showed that UK's manufacturing activity decreased at the slowest pace in six months in October.

The seasonally adjusted IHS Markit/CIPS Purchasing Managers' Index, or PMI, rose to a six-month high of 49.6 in October from 48.3 in September. Economists had forecast a modest improvement to 48.1.

The USD/CAD pair hit a 2-day high of 1.3196, marking a rise of 0.4 percent from a low of 1.3141 set at 4:00 am ET. The pair had finished Thursday's deals at 1.3164. If the greenback rallies further, it is likely to test resistance around the 1.33 region.

The greenback rose back to 0.6890 against the aussie, coming off from a low of 0.6912 hit at 4:00 am ET. Next immediate resistance for the greenback is likely seen around the 0.67 level.

Data from the Australian Bureau of Statistics showed that Australia producer prices rose 0.4 percent on quarter in the third quarter of 2019 - matching expectations and unchanged from the three months prior.

On a yearly basis, producer prices were up 1.6 percent - shy of expectations for 2.0 percent, which would have been unchanged.

In contrast, the greenback was trading lower at 0.6438 against the kiwi, just few pips short of near a 2-month low of 0.6442 it touched 10:00 pm ET. The kiwi-greenback pair was quoted at 0.6413 at yesterday's close. The greenback is seen finding support around the 0.66 mark.

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