Dollar bounces on job gains, then pares ahead of CPI

NEW YORK, Sept. 4 (Reuters) - The dollar jumped on Friday after data showed that U.S. employers added 162,000 jobs in August, well above the 56,000 additions expected by economists, boosting bets on a September Federal Reserve interest rate hike, but then pared much of the gains as traders waited on next week's inflation data.

August's jobs gains follow an unexpected 23,000 job decline in July. The unemployment rate held steady at 4.1%.

"I don't think this number changes anything really," Noel Dixon, senior macro strategist at State Street, said. "It's all going to boil down to what that core number is going to be next week and I think the markets are going to react accordingly."

Data for August is seen as key to whether the Fed will hike at its Sept. 15-16 meeting. Fed Governor Christopher Waller said on Thursday that if upcoming data confirms inflation pressures are cooling off, he is inclined to argue in favor of keeping interest rates steady.