NZD/USD steady above 0.6900 as US NFP headline reaction wanes

• NZD/USD spiked to a daily high of 0.6959 once the US Nonfarm Payrolls headline hit the wires.
• The NZD/USD retreats from daily tops as the US employment reaction fades.
• Investors seem convinced that a bond-tapering announcement could be made in the Fed’s following meeting.

The NZD/USD is advancing for the second consecutive day, is up 0.14%, trading at 0.6931, during the New York session at the time of writing. The US Nonfarm Payrolls’ knee-jerk reaction wanes, as investors seem convinced that the Federal Reserve will announce the reduction of the pandemic-era stimulus at their following meeting, despite the September lousy figure.

Reinforcing the abovementioned is the downbeat sentiment surrounding the markets. European stock markets finished with losses, except for the FTSE100, ending at 7,095.55, up 0.25%. In the US, all significant equity indices record losses between 0.11% and 0.48%, while the US 10-year benchmark note coupon is rising two and a half basis points (bps), sitting at 1.598%.

The US Dollar Index, which measures the greenback’s performance against a basket of rivals, is down 0.11%, currently at 94.10, fails to follow the US T-bond yields path.

US economy adds 194K new jobs to the economy

Earlier during the American session, the Bureau of Labor Statistics (BLS) revealed employment figures. The US Nonfarm Payrolls report showed an increase of 194K jobs added to the economy, mainly missing the foreseen 500K by economists. However, an upwardly revised August report to 366K seems to cushion the Federal Reserve prospects of a bond tapering announcement by November’s FOMC meeting.

Furthermore, the labor force participation rate fell 0.1%, down to 61.6%. The Average Hourly Earnings improved 0.6% in September, the strongest monthly advance since April, while the Unemployment Rate fell from 5.1% to 4.8%.

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