U.S. Dollar Hits Two-Month High on Strong May Jobs Report; DXY Up 0.7% to 100.06

According to U.S. Bureau of Labor Statistics data, on Friday, June 5, the dollar surged to a two-month high as strong employment figures boosted expectations for interest rate hikes. The dollar index (DXY) rose 0.7% to 100.06, marking its best week in recent months with a cumulative gain of 1.2%.

May nonfarm payroll additions reached 172,000, significantly above market expectations of 85,000, while the unemployment rate held steady at 4.3%. According to CME FedWatch tool data, the market has fully priced in expectations for one rate hike before year-end. JPMorgan analyst Michael Feroli noted that the report has "virtually cemented" a more hawkish Fed communication stance at the mid-June FOMC meeting, with potential removal of language indicating rate-cut bias from the Fed statement.