We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bearish
Gold
Bullish
Oil - US Crude
Bearish
Bitcoin
Bearish
More View more
Real Time News
  • The Australian Dollar and New Zealand Dollar tend to rise with stocks. They have recently fallen despite gains in the #SP500. What does this mean for $AUDUSD and $NZDUSD ahead? #AUD #NZD #RBA #RBNZ - https://www.dailyfx.com/forex/fundamental/article/special_report/2020/01/17/AUDUSD-NZDUSD-Outlook-Looks-Past-Stocks-to-Rate-Cut-Bets.html?CHID=9&QPID=917702 https://t.co/ddf2fV7Kyl
  • A few snippets from today's commentary. Check out the link below for the full story (via @DailyFX). https://t.co/I31tuq764r https://t.co/x0BaiOFA1P
  • Have you joined @DailyFX @facebook group yet? Discuss your #forex strategies and brush up on your skills with us here: https://t.co/jtY1G7g8yx https://t.co/e2YrN3dBrl
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.00%, while traders in France 40 are at opposite extremes with 79.59%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/UL7hqSD2Ki
  • US Dollar Forecast: $USD Lacking Impetus Ahead of Consumer Sentiment #Forex traders shift focus away from US-China trade deal headlines - perhaps toward the monthly release of #ConsumerSentiment data for volatility and clues on the Greenback's next move https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2020/01/16/us-dollar-forecast-usd-lacking-impetus-ahead-of-consumer-sentiment.html
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.11% 🇦🇺AUD: -0.02% 🇯🇵JPY: -0.03% 🇨🇭CHF: -0.05% 🇬🇧GBP: -0.06% 🇨🇦CAD: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/Kxcb9EtIWb
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.45% France 40: 0.26% Wall Street: 0.07% US 500: 0.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/I5YIsKQAog
  • 🇯🇵 JPY Tertiary Industry Index (MoM) (NOV), Actual: 1.3% Expected: 1.0% Previous: -5.2% https://www.dailyfx.com/economic-calendar#2020-01-17
  • The $JPY has weakened as a bounce-back in risk appetite saps haven-asset demand. However, the old uptrend line still provides clear resistance. Get your market update from @DavidCottleFX HERE:https://t.co/IMhgQ9jbF9 https://t.co/I7087olftk
  • Heads Up:🇯🇵 JPY Tertiary Industry Index (MoM) (NOV) due at 04:30 GMT (15min), Actual: N/A Expected: 1.0% Previous: -4.6% https://www.dailyfx.com/economic-calendar#2020-01-17
February NFP Beats Headline Expectations, Mixed at the Margin - USD Neutral

February NFP Beats Headline Expectations, Mixed at the Margin - USD Neutral

2016-03-04 14:30:00
Christopher Vecchio, CFA, Jason Cheung,
Share:

Talking Points:

- US economy added +242K jobs in February, +47K above the forecast.

- Unemployment rate holds, wage growth deteriorates to +2.2%.

- EUR/USD trades between $1.0903 and $1.1026.

The February US labor market report was much better than expectation on the headline figure but came in mixed internally, leaving the US Dollar on shaky footing overall. Despite the beat, the February headline figure dragged the three-month average lower to +228K from +241K, highlighting the choppy pace of jobs growth (although this is to be expected, especially as the year goes on, as the economy reaches its natural rate of unemployment).

Unfortunately for the US Dollar, the mixed nature of the report – especially the wage internals – have prevented a significant rebound in the USDOLLAR Index. While the USDOLLAR Index initially reacted positively to the data, the seemingly strong report rang hollow. Market participants, on advance to the March 16 FOMC meeting, have been looking for signs that maybe, just maybe, they’ve been too pessimistic on the US economy’s prospects this year; after all, there was only an 8% chance of a rate hike in March ahead of the February report.

Table 1: Fed Funds Futures Contract Implied Probabilities: March 4, 2016 (Post-NFPs)

February NFP Beats Headline Expectations, Mixed at the Margin - USD Neutral

Afterwards, this has fallen to 6%. It appears that without a further firming of future rate expectations (markets pricing year-end Fed benchmark rate at 1.00% now), the expectation of a gradual liftoff cycle remains a burden for the US Dollar. For what it’s worth, the implied probability of September being when the next rate hike occurs increased from 50% pre-NFPs to 52% thereafter.

Here are the data that’s whipping the US Dollar back and forth this morning:

- USD Change in Nonfarm Payrolls (FEB): +242K versus +195K expected, from +172K (revised higher from +151K).

- USD Unemployment Rate (FEB): 4.9% as expected unch.

- USD Average Hourly Earnings (FEB): +2.2% versus +2.5%, from +2.5% (y/y).

- USD Labor Force Participation (FEB): 62.9% versus 62.8%, expected from 62.7%.

See the DailyFX economic calendar for Friday, March 4, 2016

Chart 1: EUR/USD 1-minute Chart: March 4, 2016 Intraday

February NFP Beats Headline Expectations, Mixed at the Margin - USD Neutral

While EUR/USD initially sank from $1.0971 to as low as $1.0903, EUR/USD quickly returned back to its pre-NFP level and traded as high as $1.1026 thereafter. At the time this report was written, the pair was trading at $1.0974. Similar price action was observed across the USD-complex, with USD/JPY posting a notable reversal as well.

Read more: Preview for February US NFPs and Implications for USDOLLAR

--- Written by Christopher Vecchio, Currency Strategist and Jason Cheung, DailyFX Research

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.