US dollar near highs on strong jobs data; New Zealand dollar recovers after election

The US dollar stood near a one-and-a-half-year high against the euro and a seven-month high against the Australian dollar on Monday, as strong American jobs data lifted interest rate rise expectations. On Friday it recorded its biggest one-day gain in six months, after figures showed US job growth accelerated in October and the unemployment rate fell.

In New Zealand, the dollar recovered from a seven-month low following a closely fought general election at the weekend. Preliminary results give Prime Minister Christopher Luxon's National Party, ACT New Zealand and New Zealand First a combined 67 seats in the 131-seat parliament, where 66 are needed for a majority. However, about 400,000 votes - 15 per cent of the total - are yet to be counted, and official results are due on November 27. Both Luxon and Labour Party leader Chris Hipkins said they would wait for the final results.

The dollar index settled at 102.20, while the euro traded at US$1.1148 and the dollar at 158.18 yen. Bank of Japan governor Kazuo Ueda said he expects underlying inflation to settle around the 2 per cent target. According to the CME Group's FedWatch tool, the probability of a Federal Reserve rate rise on December 9 stands at 79 per cent, up from 71 per cent a week ago.