EURUSD trading cautiously around 1.0300 as investors anticipate December’s US NFP data, which may impact the Fed’s interest rate forecast.

EURUSD is trading subduedly around 1.0300 in Friday’s European session. The main currency pair is trading cautiously as investors anticipate the release of December Nonfarm Payrolls (NFP) data from the United States (US), which scheduled for 13:30 GMT. Investors will pay special attention to the US official employment report, which will affect market prediction about when the Federal Reserve (Fed) will deliver its first interest rate This year’s budget reduced.

The Euro rises despite markets pricing in four interest rate cuts by the ECB this year.

Economists predict that 160K new workers joined the labor force in December, down from 227K in November. The unemployment rate predicted to have remained stable at 4.2%. Month-on-month Average Hourly Earnings predicted to have increased at a slower rate of 0.3% from the previous release of 0.4%, with annual statistics rising consistently by 4%.

Signs of a weakening labor market would cause traders to reduce bets on the Fed keeping interest rates unchanged in March at their current range of 4.25%-4.50%. Meanwhile, traders believe the central bank will keep the status quo later this month, according to the CME FedWatch tool.

Ahead of the US NFP statistics, the US Dollar Index (DXY) The Greenback’s value against six major currencies has leveled above 109.00. The US Dollar (USD) held steady as President-elect Donald Trump set to declare a national economic emergency, providing legal grounds for creating an import tax plan for the country’s allies and rivals, according to CNN.

Daily market Update: EURUSD trades steady ahead of US labour market data.

EURUSD expected to be primarily driven by the US Dollar on Friday, as the US NFP data is due. Meanwhile, the Euro (EUR) outperforming the majority of its rivals, with the exception of the Japanese Yen (JPY). The Euro surges, despite traders having priced in four interest rate cuts by the European Central Bank (ECB), which will Come to every meeting by summer.

ECB officials feel comfortable with robust dovish bets because inflationary pressures in the Eurozone are generally under control. However, price pressures rose as projected in December. On Wednesday, ECB policymaker and Bank of France Governor François Villeroy stated that while price pressures are expected to rise in December, interest rates will continue to rise towards the neutral rate “without a slowdown in the pace by summer” if upcoming data confirm that the “pullback in price pressures won’t continue”.

Donald Trump, the US President-elect, anticipated to proclaim a national economic emergency.

Meanwhile, a dismal Eurozone economic outlook has raised betting on further interest rate reduction. Investors anticipate a trade war between Europe and the United States due to President-elect Donald Trump’s strongly protectionist ideas and put pressure on the Eurozone’s export sector.