Forex Today: Dollar set to keep falling, pound could be the exception

FXStreet Team FXStreet

What you need to know on Monday, May 9:

The greenback plummeted on Friday, following a poor US Nonfarm Payroll report. The US added just 266K jobs in the month, largely missing the roughly 1 million expected. The unemployment rate increased to 6.1% against the expected slide to 5.8%, while the participation rate increased to 61.7% from 61.5%. Wages rose more than anticipated but at a slower-than-average pace.

Poor US figures somehow reaffirmed the US Federal Reserve ultra-loose monetary policy, sending Wall Street firmly up and government bond yields sharply down. The DJIA and the S&P settled at record highs. US Treasury yields managed to trim intraday losses ahead of the close, with the yield on the benchmark 10-year note settling at 1.57%.

The EUR/USD pair settled at 1.2160, its highest in over two months. Over the weekend, European Commission President Ursula von der Leyen announced that the EU has struck a deal with BioNTech/Pfizer for up to 1.8 billion extra doses of their coronavirus vaccine for 2021-23. The Union aims to have 70% of its adult population covered by July.

GBP/USD flirted with 1.4000 and settled nearby. Still, the pound may suffer from weekend news. The results of the Scottish election were out on Saturday, resulting in a clear victory of Prime Minister Nicola Sturgeon’s SNP party. Sturgeon celebrated the 64 seats won and said that her priority is the pandemic, adding that she still intends to hold an independence referendum once the health crisis is over. Meanwhile, UK producers face significant barriers to EU trade ever since Brexit, with tensions in the fishing sector escalating. The pound may take note of the discouraging headlines at the weekly opening.

Canada also published April employment data on Friday. The country lost 207.1K job positions, while the unemployment rate increased to 8.1%. The numbers were worse than anticipated. The USD/CAD pair extended its slump and finished the week at 1.2124.

AUD/USD settled in the 0.7840 area, helped by soaring equities and higher gold prices. The bright metal settled at $ 1,830 a troy ounce, after reaching 1,843.30.

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FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

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