Forex - Dollar Trims Gains After U.S. Jobs Data

The dollar trimmed gains but remained supported against other major currencies on Friday, after the release of positive U.S. employment data and amid mouting optimism over a major U.S. tax reform plan.
The U.S. Department of Labor reported on Friday that the economy created 228,000 in November, beating expectations for an increase of 200,000 jobs.
The unemployment rate held at 4.1% last month, in line with expectations.
However, the report also showed that average hourly earnings rose by 0.2% in November, below forecasts for a gain of 0.3%.
The greenback was already supported after the U.S. Congress on Thursday passed legislation to temporarily fund the government through December 22, before a Friday midnight deadline and fuelling hopes the highly-anticipated U.S. tax reform will also be passed before the end of the year.
U.S. Senate Republicans agreed to talks with the House of Representatives on a major tax reform bill on Wednesday, signaling that lawmakers could agree on a final bill ahead of a self-imposed December 22 deadline.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.16% at 93.90 by 08:45 a.m. ET (12:45 GMT), just off a two-and-a-half week high of 94.07 hit earlier in the day.
The euro remained lower, with EUR/USD down 0.17% at 1.1752, while GBP/USD dropped 0.44% to trade at 1.3416.
Sterling initially strengthened after European Commission President Jean-Claude Juncker said that "sufficient progress" has been made in the first phase of Brexit talks and that discussions can now move to trade.
Also Friday, the UK Office for National Statistics reported that manufacturing production rose unexpectedly by 0.1% in October, while industrial production was flat.
Elsewhere, the yen was lower, with USD/JPY up 0.20% at 113.33, while USD/CHF held steady at 0.9949.
Earlier Friday, official data showed that Japan's gross domestic product expanded by 0.6% in the third quarter, beating expectations for a growth rate of 0.4%. Year-over-year, Japan's economy grew 2.5% in the last quarter, blowing past projections for 1.5%.
The Australian and New Zealand dollars turned higher, with AUD/USD up 0.27% at 0.7529 and with NZD/USD advancing 0.45% to 0.6861.
The Aussie was boosted by data on Friday showing that China's imports climbed more than expected by an annual rate of 17.7% in November, while exports increased by 12.3%. China is Australia's biggest export partner.
Meanwhile, USD/CAD slipped 0.25% to trade at 1.2823 after data showed that Canada's housing starts rose to 252,000 units in November from 222,700 the previous month, beating expectations for an increase to 221,000.