Stronger-than-expected jobs data from the US revived hopes of a rate cut by the Federal Reserve later this year.
Asian shares rose on Monday and the dollar stood tall after a stronger-than-expected July jobs report lifted confidence in the strength of the US economy -- heightening expectations that the US Federal Reserve could hike interest rates this year.
July non-farm payrolls rose by 255,000 jobs and the June increase was revised upward to 292,000, the Labor Department said. Economists polled by Reuters had forecast July payrolls would increase by 180,000.
"The robust US labour market data raise the chances for monetary policy normalization by the Fed, but uncertainties for the US remain high as well," wrote strategists at Barclays.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2% in early trading, after gaining 0.7% last week. US shares logged solid gains on Friday, with both the S&P 500 and the Nasdaq Composite closing at record highs.
Japan's Nikkei stock index, which skidded 1.9% last week in the face of a strengthening yen, was 1.6% higher in early trade.
The dollar was up 0.3% at 102.07 yen. It was steady against the euro at $1.1085.
The dollar index, which tracks the greenback against a basket of six major rivals, was 0.1% higher at 96.295 , not far from a one-week high of 96.522 hit on Friday after the jobs report.
"The dollar appears to be holding strong for now, but after this week, there are lots of uncertainties," said Masafumi Yamamoto, chief currency strategist for Mizuho Securities.
While major currencies are expected to stick to recent ranges, market participants say thin market conditions could amplify moves, and higher US rates were far from guaranteed.
After the US jobs report, Fed fund futures priced in an 18% chance the central bank would raise rates as early as its September policy meeting, from 9% late Thursday, according to the CME's FedWatch tool. Futures showed about a 47% chance of a December hike, compared with about 32% on Wednesday last week.
Spot gold shed 0.1% to $1,333.26 an ounce, a low not seen since July 29.
Crude oil futures, which ended modestly lower on Friday, rose in early trading. US crude added 0.6% to $42.03 a barrel, while Brent crude was up 0.4% at $44.45.
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