Investing.com - The dollar remained broadly lower against a basket of other major currencies on Monday, as investors continued to lock-in profits from the greenback's recent rally and as trading remained quiet with no major U.S. economic reports to be released throughout the session.
The dollar strengthened broadly after the Labor Department reported on Friday that the U.S. economy added 280,000 jobs in May, ahead of economists forecast for 220,000.
Hourly earnings increased 0.3% in May, after a 0.2% increase in April.
The upbeat data, particularly the pick-up in wage growth underlined the view that the economy is on track to rebound after a weak first quarter and bolstered expectations that the Federal Reserve could start to hike interest rates at its September policy meeting.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, dropped 0.60% to 95.80, down from highs of 96.95 hit on Friday.
EUR/USD climbed 0.86% to 1.1212 as German 10-year bund yields move higher, re-approaching last week’s nine-month peak.
German bund yields act as benchmarks for European financial markets and higher yields push the euro higher against the dollar. Yields rise as prices fall.
The recent rally in bund yields has been spurred by signs of an economic recovery in the euro area.
But investors remained cautious after German Chancellor Angela Merkel warned earlier Monday that "there isn’t much time left" to reach an agreement on a cash-for-reforms deal needed to unlock more financial aid before Greece runs out of money.
Athens delayed a key debt payment to the International Monetary Fund on Friday, saying it would repay the money along with other payments due this month by the end of June.
USD/JPY slid 0.38% to 125.23 after rising to 13-year highs of 125.84 on Friday.
Data on Monday showed that Japan’s gross domestic product was revised up to an annualized 3.9% in the first quarter from an initial estimate of 2.4% growth. Japan’s economy expanded by a revised 1.0% on a quarter-over-quarter basis, compared with a preliminary reading of 0.6%.
The pound was steady, with GBP/USD at 1.5269, while the Swiss franc gained ground, with USD/CHF shedding 0.35% to 0.9360.
The Australian and New Zealand dollars were stronger, with AUD/USD up 0.20% to 0.7637 and with NZD/USD gaining 0.55% to 0.7082.
Meanwhile, USD/CAD was little changed at 1.2443. Statistics Canada reported on Monday that building permits increased by 11.6% in April, beating expectations for a 3.4% gain. The change in building permits for March was revised to a 13.6% rise from a previously estimated 11.6% increase.
Another report also showed that housing starts rose by 201,700 units in May, compared to expectations for an increase of 185,000. April's figure was revised to a 183,000 gain from a previously estimated 181,800 rise.