EUR/USD hits badly as robust US labor market data diminishes Fed rate-cut bets
The post EUR/USD hits badly as robust US labor market data diminishes Fed rate-cut bets appeared on BitcoinEthereumNews.com.
EUR/USD declines from 1.0900 as upbeat US NFP report for May boosts US Dollar’s appeal. The US NFP report suggests that labor market conditions have tightened further. The ECB commenced its policy easing campaign but refrained from committing to a predefined interest-rate path. EUR/USD witnesses an intense sell-off and drops to near 1.0820 in Friday’s New York session as the United States Nonfarm Payrolls (NFP) report for May has indicated that labor demand and wage growth were stronger than expected. The Employment report showed that fresh payrolls added by US employers were higher at 272K than expectations of 185K payrolls and the prior release of 165K, downwardly revised from 175K. However, the Unemployment Rate rose to 4.0% from estimates and the prior release of 3.9%. Higher-than-expected payroll numbers are expected to clear doubts about easing labor demand that deepened after recent employment-oriented indicators have suggested that the jobs market is loosening. The JOLTS Job Openings data for April and ADP Employment Change for May came in weaker than expected. Also, Initial Jobless Claims for the week ending May 31 were higher than estimates, suggesting that some heat has been released from the labor market. Meanwhile, the Average Hourly Earnings, which measures wage inflation, accelerated to 4.1% from expectations of 3.9% and the prior release of 4.0%, upwardly revised from 3.9% on a year-on-year basis. On a monthly basis, the wage inflation measure grew at a robust pace of 0.4% against the consensus of 0.3% and the former reading of 0.2%. This has deepened fears of inflation remaining persistent, which has resulted in a sharp decline in market expectations for the Federal Reserve (Fed) to start reducing interest rates from the September meeting. According to the CME FedWatch tool, the probability of rate cuts in September has come down to 54.4% from 68% after the release of the US NFP report. Daily digest market movers: EUR/USD weakens US Dollar rallies EUR/USD…
Filed under: News - @ June 8, 2024 6:20 am