NEW YORK (CNNMoney.com) - The dollar lost major ground against the yen and the euro Friday after the a lackluster jobs report suggested that the Federal Reserve is closer to the end of interest rate hikes than previously thought.

Treasury prices fell slightly Friday after the Labor Department reported a weaker-than-expected rise in December job growth.

The dollar fell against the euro and yen.

The benchmark 10-year note fell 5/32 to 100-30/32, yielding 4.38 percent, up from 4.35 percent late Thursday. The 30-year bond lost 8/32 to 112-1/32 to yield 4.57 percent, up from 4.55 the previous session.

The two-year note was down two ticks, yielding 4.36 percent, while the five-year note dipped 5/32, yielding 4.32.

Bond prices and yields move in opposite directions.

The Labor Department announced Friday that December jobs climbed by 108,000, compared with a revised gain of 305,000 in November. Economists surveyed by Briefing.com had forecast a gain of 200,000 jobs on U.S. payrolls in the most recent month.

The unemployment rate came in at 4.9 percent, compared with 5 percent in November. Economists had forecast the rate would remain at 5 percent.

While the weaker-than-expected payrolls report may indicate an end might be in sight, the upward revision of November figures and the drop in the rate of unemployment could spark speculation the Fed will raise rates at its March 28 meeting.

The central bank, which began its monetary tightening campaign in June 2004, has raised rates in an effort to contain inflation by slowing economic growth.

Looking ahead to next week, investors are expected to closely watch December's retail sales figures and the Producer Price Index, both due next Friday, for more clues about the economy's strength.

The euro bought $1.2159, up from $1.2103 late Thursday in New York. The dollar bought ¥114.42, down from ¥115.99 the previous session.

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