US dollar erased daily gains following a weaker-than-expected US nonfarm payrolls report.
US Dollar Index (DXY) has reversed earlier gains after a much lower-than-expected US Nonfarm Payrolls (NFP) data. The impact on the dollar has been mild, as the market has factored in the impact of strikes as well as Hurricanes Helen and Milton in the final reading.
The constant unemployment rate and an increase in hourly pay have moderated the USD’s unfavorable impact.
Nonfarm payrolls have had their lowest performance since the epidemic, despite the steady unemployment rate and an increase in hourly wages have outweighed investors’ concerns about a significant downturn in the labor situation.
The focus now shifts to the US ISM Manufacturing PMI, which projected to rise somewhat but remain at levels consistent with the sector’s overall activity reduction.
Daily market movers: US Dollar creeps up with major US data on tap.
US nonfarm payrolls climbed by 12K in October, considerably below market estimates of 113K. September’s reading has been increased to 223K, up from 254K earlier projected.
The negative impact of the headline figure mitigated by the stable unemployment rate, which stands at 4.1%, and higher hourly wages, which increased at a 0.3% rate, up from 0.2% the previous month.
ISM Manufacturing PMI predicted to had improved somewhat to 47.6 from 47.2 the previous month. Nonetheless, it would stay at levels indicating a downturn in the sector’s business activity.
According to data from the CME Group Fed Watch tool, markets are still nearly fully pricing in a 25 basis point cut by the Federal Reserve (Fed) next week and an 85% possibility of another 25 basis point drop in December, up from 76% in prior days.
Investors are betting that former President Donald Trump would win the US presidential election and follow an inflationary strategy of low taxes, high spending, and import tariffs, which is giving the US Dollar extra strength.
