Euro remained tranquil ahead US nonfarm payrolls
After making big gains the day before, the euro is exhibiting little change on Friday. The EURUSD is trading at 1.0633, up 0.10% in the European session.
Nonfarm payrolls in the United States are predicted to fall to 170,000.
All eyes are on nonfarm payrolls in the United States.
Since the Federal Reserve’s announcement on Wednesday, the US dollar has been under intense pressure. The Fed statement was essentially a duplicate of the one issued in September, with Fed Chair Powell stating that rate hikes were still on the table. The markets did not buy Powell’s words, and views are growing that the Fed is nearing the end of its tightening cycle. The ADP Employment Change data, which isn’t a good indicator of nonfarm payrolls but is nevertheless extensively followed, , reported a modest growth of 113,000 in October, significantly below the market forecast of 150,000 and following a reading of 89,000 in September.
Will nonfarm payrolls follow suit and report lower-than-expected numbers? Nonfarm payrolls increased by 336,000 in September, but the market consensus for October is only 170,000. If nonfarm payrolls fall short of estimates, it is likely that the current tightening cycle has ended. A positive surprise, on the other hand, would lend credence to the Fed’s position that the economy is still strong and that rate hikes are still on the table. If nonfarm payrolls exceed estimates, I expect the US dollar to rise.
The Fed will also keep a watch on wage growth, which is a key driver of inflation. . Wages increased 0.2% month on month in September, with the market expecting a 0.3% increase in October. Wage growth is predicted to slow to 4.0% on an annualized basis in October, down from 4.2% in September.
Eurozone figures were disappointing, serving as yet another reminder of the region’s ailing economy.
Today’s eurozone figures were disappointing, serving as yet another reminder of the region’s ailing economy. After a corrected -0.1% reading in August, French Industrial Production fell 0.5% m/m in September, falling short of the market consensus of 0.0%. The unemployment rate in Spain increased to 36,900 in October, up from 19,800 in September and the highest level since April.
EURUSD Technical analysis
Resistance levels 1.0664 and 1.0764.
Support levels 1.0595 and 1.049509
