When is the US monthly jobs report (NFP) and how could it affect EUR/USD?
|US monthly jobs report overview
Friday's US economic docket highlights the release of the closely watched US monthly jobs data, popularly known as nonfarm payrolls (NFP). The report is scheduled to be released at 13:30GMT and is expected to show that the US economy added 175K new jobs in February, down from the previous month's strong reading of 225K.
Meanwhile, the unemployment rate is expected to hold steady at 3.6% during the reported month and hence, the key focus will remain on wage growth figures, which have gained more traction in the recent past. Average hourly earnings are foreseen to post a growth of 0.3% on a monthly basis, versus the previous month's rise of 0.2%. Conversely, the yearly growth rate is anticipated to edge lower to 3.0%, from January's reading of 3.1%
How could the data affect EUR/USD?
Given that investors have started pricing in another 50 bps Fed rate cut on March 18, even a slight disappointment might be enough to dent the already weaker sentiment surrounding the US dollar and provide an additional boost to the EUR/USD pair's ongoing strong bullish momentum. Conversely, a stronger reading seems unlikely to provide any meaningful respite to the USD bulls, albeit might prompt some profit-taking amid extremely overstretched conditions on short-term charts.
Yohay Elam, FXStreet's own analyst provided some important technical levels to trade the major – “Initial resistance awaits at the daily high of 1.1280, followed by 1.1320 and 1.1390 – levels last seen in the summer. Support is at 1.1215, a swing high from earlier this week, followed by 1.1180, a level that capped EUR/USD before and after this swing move. 1.1120 provided support this week and 1.11 is a double bottom”.
Key Notes
• US Non-Farm Payrolls February Preview: The first facts
• EUR/USD Forecast: 500-pip rally only be the beginning as coronavirus spreads in America, NFP eyed
• EUR/USD Price Analysis: Extra gains now look to 1.1400 and above
About the US monthly jobs report
The nonfarm payrolls released by the US Department of Labor presents the number of new jobs created during the previous month, in all non-agricultural business. The monthly changes in payrolls can be extremely volatile, due to its high relation with economic policy decisions made by the Central Bank. The number is also subject to strong reviews in the upcoming months, and those reviews also tend to trigger volatility in the forex board. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish), although previous months reviews and the unemployment rate are as relevant as the headline figure, and therefore the reaction depends on how the market asses them all.
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.