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U.S. Dollar Strengthens as Jobs Data Dims Rate Cut Prospects

2/12/2026

36 8 Full Breakdown

Summary

Story summary

The U.S. dollar index rose 0.16% after January jobs data showed nonfarm payrolls up 130,000 and the unemployment rate at 4.3%.
That data reduced the likelihood of a Federal Reserve rate cut next month from 23% to 6%.
Kansas City Fed President Jeff Schmid said rates should remain "somewhat restrictive" to curb inflation.
Precious metals rose as investors sought safe havens amid political uncertainty and a weakening dollar.

History

Historical Context

In 2006, the U.S. Federal Reserve, led by Chairman Ben Bernanke, raised interest rates to 5.25% to combat inflation, a strategy reminiscent of the 1980s under Paul Volcker. This decision aimed to stabilize the economy amid rising prices. Today, with a 4.3% unemployment rate and 130,000 new jobs, the Fed's ongoing adjustments reflect its critical role in managing economic stability and inflation concerns.

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Story summary

The U.S. dollar index rose 0.16% after January jobs data showed nonfarm payrolls up 130,000 and the unemployment rate at 4.3%.
That data reduced the likelihood of a Federal Reserve rate cut next month from 23% to 6%.
Kansas City Fed President Jeff Schmid said rates should remain "somewhat restrictive" to curb inflation.
Precious metals rose as investors sought safe havens amid political uncertainty and a weakening dollar.

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