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EUR/USD holds minor gains after Non-Farm Payrolls

Latest US labor market data failed to spur any significant volatility in the USD, the medium-term downtrend for the pair remains intact.

The EUR/USD pair showed only a slight desire to move after the latest macro data, trading 0.1% higher during the US session. The greenback’s initial decline after the data was short-lived, and traders quickly bought the dip.

US job market update for September

Earlier today, the Bureau of Labor Statistics informed that with expectations of a 500,000 print and whisper numbers sharply higher, in September, the US added only 194,000 jobs, down by nearly half from the upward revised 366K in August , and the lowest print of 2021. The USD dropped broadly after this weak number.

Moreover, both prior months were revised higher. The change in employment for July was revised up by 38,000, from +1,053,000 to +1,091,000. The August’ change was revised up by 131,000, from +235,000 to +366,000.

Additionally, the unemployment rate improved notably to 4.8%, from 5.2% , and below the 5.1% expectation as the number of unemployed workers dropped by 710,000 from 8.384 million to 7.674 million.

Lastly, the average hourly earnings rose again, improving from 0.4% to 0.6% month-on-month , beating the consensus of 0.4%. On a yearly basis, hourly earnings rose 4.6%, in line with expectations.

It was a somewhat mixed report, with the headline non-farm payrolls dropping and hugely missing expectations, but other parts of the report were actually better than expected. Therefore, the decline in the USD seems to be limited, and it is slowly erasing the initial reaction’s drop.

From other news, Christine Lagarde, President of the Europen Central Bank (ECB), said on Friday that they need to manage the exit from the pandemic very carefully. However, market participants already know that central banks won’t rush to exit from their money-printing programs. Therefore, her remarks failed to spur any (downside) volatility in the EUR/USD pair.

There is nothing new on the daily chart – the euro keeps sliding toward the critical support of 1.15. Still, it looks like the bearish momentum wanes slowly, implying a possible bullish bounce soon, especially if traders re-interpret today’s data as bearish for the USD.

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