EUR/USD extends recovery above 0.9900 as risk-off fades, US NFP in focus
|- EUR/USD has overstepped the major hurdle of 0.9900 as the risk-off market tone has started fading away.
- The DXY is going through a tough time ahead of US NFP data.
- Weaker projections for Eurozone Retail Sales indicate a decline in retail demand.
The EUR/USD pair has crossed the immediate hurdle of 0.9900 confidently and is expected to establish above the same. The risk profile is getting cheerful now as S&P500 has rebounded firmly. Also, yields have cooled as investors are shifting their focus toward the US Nonfarm Payrolls (NFP) data. The 10-year benchmark yields have slipped below 3.75%.
Meanwhile, the US dollar index (DXY) has slipped sharply to near 111.00. The DXY is facing volatility amid lower consensus for the US employment data. Escalating interest rates by the Federal Reserve (Fed) to combat the mounting inflation has trimmed employment opportunities.
The corporate has been left with no option but to postpone the capacity expansion and investment plans to avoid higher interest obligations. This results in a slowdown in the job creation process.
Per the expectations, the US Nonfarm Payrolls (NFP) data will decline to 250k vs. the prior release of 315k. The jobless rate is seen as stable at 3.7%. Apart from that, the Average Hourly Earnings data will remain in focus, which is expected to trim by ten basis points (bps) to 5.1% on an annual basis.
However, the upbeat release of the US Automatic Data Processing (ADP) payroll data on Thursday is not supporting the case for a slowdown in the recruitment process by the corporate sector. But the US NFP data is expected to display a clear picture of employment status in the US economy.
On Thursday, the eurozone bulls will dance to the tunes of Retail Sales data. According to the estimates, the economic catalyst will decline by 1.7% against the former print of 0.9%. This indicates a slowdown in the overall retail demand and the mounting price pressures are responsible for the same. Apart from that, firms in the trading bloc face a severe decline in operating margins due to soaring energy prices.
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.