FOREX -US dollar stumbles after nonfarm payrolls data

By Gertrude Chavez-Dreyfuss

NEW YORK, March 7 (Reuters) - The U.S. dollar dropped to multi-month lows against the euro and yen on Friday, after data showed the world's largest economy created fewer jobs than expected last month, suggesting that the Federal Reserve remained on track to cut interest rates multiple times this year.

The greenback slid 0.5% against the yen to 147.205 JPY=EBS, after earlier falling to a five-month low of 147.05 yen. The euro, meanwhile, hit another four-month peak of $1.0888 after the data. It last traded at $1.0863, up 0.7% EUR=EBS.

Nonfarm payrolls increased by 151,000 jobs last month after rising by a downwardly revised 125,000 in January, according to the Labor Department's Bureau of Labor Statistics. Economists polled by Reuters had forecast payrolls gaining 160,000 jobs after a previously reported 143,000 rise in January.

"Friday's jobs report was weaker than expected, which is concerning because this report doesn't account for the recent government job cuts from DOGE, so it suggests that businesses are taking a pause on hiring until there is more certainty about tariff policy and the economic outlook," said Glen Smith, chief investment officer, at GDS Wealth Management in Flower Mound, Texas, in emailed comments. The firm has with $1.2 billion in assets.

U.S. rate futures on Friday priced in 78 basis points (bps) of easing, or about three rate cuts of 25 bps, according to LSEG calculations. The first rate cut is likely to resume in June.