Impact of US Job Data on Forex: Insights for Traders

Written by

Anthony Bull

Daily Currency Update

Impact of US Job Data on Forex: Insights for Traders

Forex Market Update – September 9, 2024

Recap of Last Week’s Data:

  • US Nonfarm Payrolls (August): The US added 142K jobs in August, missing the expected 160K. This has led to speculation about whether the Federal Reserve will adjust interest rates, impacting the forex market, especially for pairs like GBP/USD​(FX.co).
  • UK Retail Sales (YoY) (July): Retail sales dropped 0.1%, missing expectations of a 0.1% gain, signaling weak consumer spending and putting pressure on the GBP/USD pair​(FX.co).
  • Canada Employment Data (August): Canada added 22.1K jobs, which was below expectations. The unemployment rate rose to 6.6%, creating a mix of caution for traders in the Canadian dollar​(FX.co).

This Week’s Key Data Releases:

  • Tuesday, September 10:
    • UK Unemployment Rate (July): Expected to remain at 4.1%. This figure is key for the pound’s performance in the forex market, particularly for the GBP/USD pair​(FX.co).
  • Wednesday, September 11:
    • US Consumer Price Index (CPI) (August): Expected to rise by 0.2% month-on-month, which could push the US dollar higher. This data will be vital for determining any changes to mortgage rates​(FX.co).
  • Thursday, September 12:
    • ECB Meeting: The ECB is expected to keep rates steady, but any changes could create volatility in the EUR/USD pair​(FX.co).

Currency Pairs Outlook:

  • GBP/USD: The pair is currently trading at 1.31032, down 0.18% for the day. UK employment data expected tomorrow could have a major impact on this pair, especially if unemployment deviates from expectations​(FX.co).
  • EUR/USD: Trading at 1.10617, down 0.21% today. Markets are watching closely for the ECB’s decision this week to gauge the euro’s strength​(FX.co).
  • USD/JPY: The yen is at 142.925, up 0.49%. Traders are monitoring upcoming US inflation data, which could affect the pair’s performance​(FX.co).

Commodities:

  • Oil: WTI crude is trading at $68.53 per barrel, up 1.27% today, although concerns about global demand continue to affect prices​(FX.co).
  • Gold: Gold is steady at $2,490.09 per ounce, up slightly by 0.12%. Traders are awaiting US CPI data to see if inflation will drive demand for safe-haven assets like gold​(FX.co).

Mortgage Rates and Central Bank Decisions:

This week, mortgage rates are expected to remain a key topic, especially with the upcoming US inflation data on Wednesday. If inflation comes in higher than expected, we could see changes in mortgage rates across the US. In Europe, the ECB’s rate decision could impact mortgage rates in the eurozone, especially as inflation remains a concern.

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