The dollar strengthened in response to the report and "there are a couple elements to the market logic", they say. "In the current environment, global growth concerns are dollar supportive. In addition, the data taken was not far from expectations and this meant it posed no obstacle to what the market wanted to do in the first place, which was to sell the European and emerging market currencies (risk off)".
After US and Canadian employment data release, "the important take away from today's data for medium term investors is 1)it is too early to take calls for QE3 seriously for the July 31 FOMC meeting, especially given that Operation Twist was just extended 2) ideas that Canada could hike rates any time soon seems misplaced".
"The important question for short-term participants is whether today will be a trend day or will consolidation emerge ahead of the weekend", BBH team says. "We lean toward the latter after yesterday's large moves, ahead of the weekend and the European finance ministers' meeting on Monday".