Investing.com - The U.S. dollar extended gains against other major currencies on Friday, after data showed that the U.S. economy added more jobs than expected this month, adding to optimism over the strength of the economy.

The U.S. Labor Department said the economy added 200,000 jobs in January, beating expectations for a 184,000 gain.

The unemployment rate remained unchanged at 4.1% this month, in line with expectations.

The report also showed that average hourly earnings rose 0.3% in January, as expected.

The greenback was already supported after the Federal Reserve, at the conclusion of its policy meeting on Wednesday, signaled its confidence about inflation and growth in the U.S.

The Fed said that inflation is likely to rise this year, boosting expectations for further interest rate hikes under incoming central bank head Jerome Powell.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.50% at 88.92 by 08:35 a.m. ET (12:35 GMT).

The euro and the pound pushed lower, with EUR/USD down 0.39% at 1.2465 and with GBP/USD declining 0.62% to 1.4348.

Research group Markit reported earlier Friday that its UK construction purchasing managers index fell to 50.2 in January from 52.2 the previous month, compared to expectations for a downtick to only 52.0.

The yen and the Swiss franc also remained weaker, with USD/JPY up 0.70% at 110.16 and with USD/CHF gaining 0.40% to 0.9303.

Elsewhere, the Australian and New Zealand dollars extended losses, with AUD/USDtumbling 1.08% to 0.7952 and with NZD/USD retreating 0.99% to 0.7324.

Meanwhile, USD/CAD advanced 0.73% to trade at 1.2353.