- Euro Weakness Continues amid US Rebound
- High Expectations on Job Numbers
- Markets Rise Again on Upbeat Sentiment
Friday is a key day for the forex market and in particular, the strengthening US Dollar as non-farm payroll numbers are due today with high expectations alongside the unemployment rate for January. This comes as weekly jobless numbers dipped below again close to pandemic level lows. Europe meanwhile has not seen the same levels of optimistic recovery as yet and the Euro is showing the strain of this. Markets on Wall Street also look set to continue their upward trajectory particularly if these numbers come in as positive as expected.
Euro Turmoil Continues as USD Bounces Back
Those forex trading the EUR/USD have been met with a below-par Euro which is now looking below the $1.20 mark. While the Dollar is gaining momentum thanks to market optimism and rising treasury yields, a suffering Euro is equally responsible for the drop back. Unimpressive data from the Eurozone within the last week have also done nothing to lift the currency.
Germany, the largest economy in the bloc, reported a 1.9% drop in factory orders for the month of December. This appears to have hit the Euro as the region also deals with a slow vaccine rollout that appears quite the opposite of how the US is now progressing with the one-shot J&J vaccine poised for approval soon.
Employment Numbers Predicted to Impress
Coming fast on the heels of strong weekly job numbers, US NFP predictions are for a significant increase in the number of jobs. Analysts are pointing to at least 50,000 new jobs being created, though the real number it is hoped will be higher. While this would be impressive, it could also lead to some selling of the Dollar to bank profit from traders, particularly if the number comes out with a strong beat. The unemployment rate is predicted to stay at 6.7%.
It has already been a strong week for jobs data with the number of initial weekly claims in the US dropping below 800,000 for the first time since November last year. This also comes as the US Senate has approved the Democratic plan to pass a $1.9 trillion stimulus package. This without the support of Republicans who had wanted to negotiate a lesser package.
Markets Set to Open Higher Again
Markets on Wall Street look set to open higher for the third consecutive day as not only forex brokers are caught in the wave of optimism. The major indices all added strong daily gains over the last two days, and that looks set to continue today with the futures market pointing toward a positive open.
This too could be influenced by the NFP numbers as traders look for a continuing guide toward how the nation is recovering and getting back to work. With Robinhood trading restrictions removed, trading in the likes of GameStop also seems to have resurrected with the company trading up 15% in the pre-market.