The USD is weakening a bit overall, but trends in G10 FX are relatively calm. Markets overall are relatively calm as market participants await Friday’s US employment data, notes Shaun Osborne, Chief FX Strategist at Scotiabank.
USD mixed as markets stabilize ahead of Friday’s jobs data
“Stocks are slightly mixed and major bond markets are little changed on the session. US 10-year Treasury yields have retreated slightly. But yields fell sharply yesterday after weak JOLTS data raised concerns that the US labour market is slowing, while the Beige Book pointed to flat or weaker activity in most Federal Reserve districts.”
“We get more data this morning in the form of ADP data and the latest weekly claims figures. ADP has proven to be a poor guide to NFP, but a weak report today will likely add to market anxiety ahead of NFP. ISM Services data is due at 10ET. Japan reported stronger-than-expected wage gains for July overnight; a 3.6% year-over-year rise in cash gains was well ahead of forecasts, reinforcing expectations that the BoJ will push ahead with another small rate hike before year-end.”
“Lower US short rates (US 2-year bond yields fell about 10 basis points in response to yesterday’s developments) will weigh—if sustained—on the USD at least in the near term and may help drive the DXY broadly lower towards our spread-driven fair value estimate of 100.0. Short-term technical indicators are skewing lower again for the index, which may have peaked on Tuesday as the late-August/early-September dollar bounce fades. DXY support is at 100.8 and—more strongly—100.5.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
