EUR/USD advances to 1.1120, remains on track to post weekly losses
|- US Dollar Index erases daily gains after disappointing NFP data.
- Falling US Treasury bond yields weigh on greenback.
- EUR/USD pair erases around 50 pips this week.
The EUR/USD pair extended its rebound during the American trading hours and reached a fresh daily high of 1.1120 with the greenback struggling to find demand after disappointing labour market data. As of writing, the pair was up 0.12% on the day at 1.1118.
USD weakness helps pair recover
Earlier in the day, the US Bureau of Labor Statistics reported that Nonfarm Payrolls in December increased by 145,000 to miss the market expectation of 164,000. Furthermore, the Average Hourly Earnings only rose 0.1% on a monthly basis and dragged the annual rate to 2.9% from 3.1%.
In addition to the dismal data, falling US Treasury bond yields also weighed on the USD. As of writing, the 10-year US T-bond yield was down 2.5% on a daily basis and the US Dollar Index, which touched a fresh two-week high of 97.58, was erasing 0.08% on the day at 97.35.
Commenting on the market reaction to the NFP data, "the USD is a little softer following the disappointment relative to consensus, though we think this is much ado about nothing," said TD Securities analysts. "On the whole, labor markets remain in decent shape though the deceleration in wage inflation since early 2019 may become a focal point for markets going forward."
Despite today's recovery, the EUR/USD pair remains on track to post weekly losses for the second straight week.
Technical levels to watch for
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.