US jobs data disappoints, equities and bonds steady, dollar lower
The highly-awaited US jobs data was released this morning. The Labor Department reported that Nonfarm Payrolls rose by 194K in September, much less than the 500K expected, and the smallest monthly gain in 2021. The unemployment rate dropped to 4.8% from 5.2%, and Average Hourly Earnings rose 0.6% MoM, as expected. Markets considered today’s employment data as a key factor for the Federal Reserve’s decision on when to begin tapering, and analysts seem to believe that the data is decent enough for the Fed to proceed. There was a muted reaction in equity and bond markets, but in the FX market, the dollar was broadly sold. Last night, the Senate passed a short-term debt-limit increase, and the House is expected to vote on it early next week. Canada’s jobs data for September was more upbeat, with a 157K positive net gain in employment and a rise in the Participation Rate to 65.5%, up from August’s 65.1%.
October 8, 2021
EUR/USD 1.1569 GBP/USD 1.3640 USD/CAD 1.2499 AUD/USD 0.7313 USD/JPY 111.89 USD/CNH 6.4406 USD/ILS 3.2293 USD/MXN 20.6278 USD/CHF 0.9276 USD/INR 74.9925 USD/BRL 5.5092 USD/SGD 1.3545 USD/DKK 6.4314 USD/SEK 8.7357 USD/NOK 8.5418
The dollar index quickly fell about 0.2% following this morning’s somewhat disappointing US employment data for September. The best performing currencies were Scandinavian (SEK and NOK) and commodity currencies (CAD, NZD and MXN). The dollar index is ending the week near Monday’s opening level, but not far from its highest levels of the year.GBP
The UK pound is little changed from last night’s closing level but remains up on the week. A Bank of England report said that the UK is more vulnerable to financial shocks than other nations, as risks are overly sensitive to developments in trade and banking in the eurozone and US, as well as in the UK.EUR
The euro barely moved overnight, but is down for the week, generally in line with other G-10 currencies versus the US dollar. It continues to trade under $1.16, with many technical analysts seeing strong support at $1.15.CAD
The Canadian dollar is up overnight and ends the week as the strongest G-10 currency. This morning’s Canada employment data was upbeat, with both Net Change in Employment and the Participation Rate better than expected and well up from August’s data.ASIA/PACIFIC
China’s Golden Week ended yesterday, and both Chinese equities and the renminbi strengthened overnight.
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