NEW YORK/LONDON, June 7 (Reuters) - The U.S. dollar jumped on Friday after data showed the world's largest economy created a lot more jobs than expected last month, suggesting that the Federal Reserve could take time in starting its easing cycle this year.
U.S. nonfarm payrolls expanded by 272,000 jobs last month, data showed, while revisions showed 15,000 fewer jobs created in March and April combined than previously reported. Economists polled by Reuters had forecast payrolls advancing by 185,000.
The unemployment rate, however, edged up to 4% from 3.9% in April, breaching a level that had previously held for 27 straight months.
"This blockbuster NFP (nonfarm payrolls) makes it harder for the Fed to move towards a cut in rates," Giuseppe Sette, president of market research firm Toggle AI, wrote in emailed comments.
"The next few months will be interesting as the Fed will have to tussle with the stronger performance of the U.S. economy, limiting its ability to follow the example of the ECB and cut."
The dollar rose 0.7% against the yen to 156.775 . The U.S. currency though was still down 0.2% on the week, on track for its worst weekly performance since late April.
The euro dropped 0.5% versus the dollar to $1.0832 . On the week, Europe's single currency slipped 0.22%, its largest weekly percentage loss since the week starting April 8.
The currency's losses also came a day after the European Central Bank cut rates in a well-telegraphed move, but offered few hints about the outlook for monetary policy given that inflation is still above target.
The U.S. dollar index , which tracks the currency against the euro and five other major rivals, rose 0.6% to 104.76.
For the week, the index was on track for a 0.1% gain, with the strong jobs number offsetting a run of weaker macro data that had prompted investors to put two quarter-point Fed rate cuts back on the table for this year.
The Federal Open Market Committee is not expected to make any change at its policy meeting next week, but after the jobs data, the rate futures market has priced in just one cut of 25 basis points this year, either at the November or December meeting, according to LSEG's rate probability app.
Reporting by Gertrude Chavez-Dreyfuss in New York and Amanda Cooper in London; Editing by Lincoln Feast, Alex Richardson and Andrew Heavens
