Published on 06.10.2022 17:59

The Euro has continued to decline further as we enter the American trading session and is currently sitting at $0.9817 which is the lowest level in two days. The intraday movements are looking bearish with the US dollar looking stronger ahead of the NFP due out on Friday which could turn out to be the most important news of the year.

Economic data released today in the US showed a larger-than-expected increase in Initial Jobless Claims- figures which hit their highest level in five weeks. Despite the disappointing jobs figures, the dollar remains firm as Fed talk about the need to continue rising rates, keeps giving the dollar support.

The key drivers of dollar’s strength on Thursday are US yields. The US 10-year yield jumped to the highest level in a week to 3.84 percent and the 2-year climbed above 4.20 percent.

It is hard to see the Euro making any significant gains against the greenback as market participants await the release of the US official employment report on Friday.

 Market consensus is for an increase in the Non-farm payrolls figure of 250K and analysts from TD Securities see another strong advance in September and warn that such a scenario would represent another disappointment for those predicting that the Fed will ease up on their rate hiking cycle

“We look for payrolls to have continued to advance strongly in September to 300k which would represent little change vs the 315k increase registered in August. We look for this solid net gain in employment to be reflected in a decline in the UE rate to 3.6% following its unexpected 0.2pp jump to 3.7% in August.” they said.


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