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USD mixed ahead of NFP

ByACM
Published 06/03/2011, 07:40 AM
Updated 01/01/2017, 02:20 AM
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The Dollar remains mixed ahead of today’s US non-farm payroll data which is estimated at 100,000 – 175,000 based on market estimates and we expect jobs data to be on the lower end thus reducing growth outlook in the US. USDJPY fell to a three-week low of 80.63, EURUSD moved up to highs of 1.4518, continuing with the positive momentum before reports due next week to show producer-price inflation moved up, AUDUSD traded near a three-week high of 1.0716 as EU debt issue concerns have eased slightly. The US outlook could remain weak and the Dollar on a downward trend as jobs figures suffer and companies deter from fresh hiring, the Fed may look into additional easing with talks of a QE3, weakening commodity and stock markets. The Fed and BOJ are holding rates while ECB is expected to increase further rates even as Portugal, Ireland and Greece suffer from default on debt.

The EU/IMF will today complete the review of Greece’s plan for 78 Billion Euro in asset sales and austerity measures with Greece approaching a second bailout and EU leaders are planning out the bailout plan for Greece by end of June and persuade IMF to pay out its share of tranche of loans to Greece. Moody’s may cut US’s AAA credit rating unless there’s progress on increasing the debt-limit by mid-July with Moody’s saying that there could be a possibility of a short-lived default.

Today’s calendar will show releases of service sector data from EU, UK, and US while focus remains strong on US Non-farm payrolls and unemployment rate. If we see positive jobs data, we can expect Dollar to strengthen against most currencies on positive US economic outlook while any weak data as expectations are, could see Dollar declining further along with commodities and equity markets.

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