OctaFX | OctaFX Forex Broker
Open trading account
Back

US Dollar spikes to fresh multi-week highs above 94 post-NFP

  • Unemployment in the U.S. steady at 4.1%.
  • NFP rises more than expected in November.
  • Wage inflation remains soft.

With the initial reaction to the nonfarm payroll report from the United States, the US Dollar Index, which tracks the greenback against a basket of six trade-weighted peers, jumped to its highest level since November 21 at 94.07 but struggled to extend its upside. As of writing, the index was at 93.80, still up 0.15% on the day.

Friday's highly anticipated data showed that total nonfarm payroll employment increased by 228,000 in November following Octobers 244,000 increase (revised from 261,000) and beat the market estimate of 200,000. The unemployment remained unchanged at 4.1 in November while the wage inflation measured by the average hourly earnings rose 0.2% on a monthly basis after coming in unchanged in October. Despite that increase, however, the annual rate came in at 2.5%, missing the market estimate of 2.7%.

Although today's data was good enough to reassure a December rate hike, the soft wage inflation may force the Federal Reserve to adopt a more cautious tone in 2018.

Later in the day, the University of Michigan is going to announce the preliminary consumer confidence data for December, which is expected to improve to 99 from 98.5. A robust reading could allow the DXY to make a new attempt to break above the 94 mark.

Technical outlook

94 aligns as the first technical resistance for the pair and a weekly close above that level could open the door for further gains towards 94.55 (Nov. 11 high) and 95 (psychological level). On the downside, supports could be seen at 93.50 (Dec. 7 low), 93 (psychological level) and 92.40 (Nov. 27 low).

USD/JPY remains capped by 113.60 on mixed US employment data

The bid tone around the US dollar weakened a bit, following the release of the final US labour market report for this year, knocking-off the USD/JPY p
Read more Previous

GBP/USD: Heavy, 1.3400 tested on US NFP

The GBP/USD pair dropped to test the 1.3400 mark on the release of the US Nov jobs report, before attempting a minor recovery towards 1.3430 levels.
Read more Next
Start livechat