The June U.S. Non Farm Payrolls Report showed that employers cut more jobs last month than estimated, curtailing demand for higher –risk, higher-yielding assets while sending the U.S. Dollar sharply higher.

Pre-report guesses indicated that traders were positioning themselves for a job loss of 365,000. The Dollar rose sharply higher when the U.S. Labor Department reported a total loss of 467,000. The unemployment rate rose to 9.5%, slightly better than the estimate but nonetheless set the stage for a possible move to double-digits sometime in the near future.

The surprise weakness in the U.S. employment picture drove investors into the Dollar as traders became more averse to risk and attracted to the relative safety of the Greenback. This report was another sign that forecasts of “green shoots” in the economy may have been overblown. At this time it looks as if sentiment indicators may have mislead investors into thinking the economy was on the road to recovery while hard economic reports such as consumer inflation and GDP were showing a slowdown in growth and indications that there would be no rapid recovery.

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