Assuming that the NFP’s do not disappoint, the more interesting question is will they have much impact on the currency market? With most players anticipating 200K, a number only slightly higher than consensus is unlikely to provide much fuel to dollar bulls. However, if the figure exceeded 300K. the effect on the currency market may be substantial, as traders would have to reassess their present thesis that the Fed is nearly finished hiking rates. At 300K or above, 5% Fed funds rates becomes a serious possibility and as a result EUR/USD may head back to below 1.2000 once again.
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