The EUR/USD stabilized around 1.1500 as tensions mount ahead of the US Non-Farm Payrolls. The event could prove a win-win situation for the US Dollar and a lose-lose for the Euro.
The all-important jobs report is expected to show an increase of nearly 200,000 positions according to the official estimates. However, real expectations are higher after the ADP NFP showed an impressive gain of 230,000 private sector positions. Also, the ISM Non-Manufacturing PMI hit a record of 61.6 points in September, with a leap in the employment component as well. Annual wage growth is expected to accelerate to 3%.
On the other hand, some are concerned about the impact of Florence, the hurricane that battered the Carolinas may skew the results. The storm hit made landfall on the last day of the September survey.
So, a beat will be good news for the US Dollar while a miss will be blamed on Florence. A win-win for the greenback.
The USD continues enjoying upside momentum following the data, rising yields, and Powell’s hawkish comments. Also, fresh concerns about the US-Chinese spat also support the US currency amid safe-haven flow. US Vice President Mike Pence accused China of high-level and broad espionage, an accusation denied by Beijing but that already hit tech stocks, especially in China.
In the old continent, there are no substantial figures coming out. Italy presented its growth forecasts which accompanied the budget plans. The 2.4% budget deficit planned for 2019 breached EU demands, and both sides remain on a collision course. This slightly weighs on the Euro.
It is important to remember that US traders will enjoy a long weekend due to Colombus Day on Monday and this can trigger some last-minute jitters.
