The U.S. Dollar is trading in a mixed bag this morning following the release of the long-awaited September payroll and unemployment numbers this morning
Overview
Traders were expecting figures to print at better levels than they did, with the Dollar Index sitting at a 6-month high going into release, but the majority of those gains have been subsequently erased.
Non-Farm Payrolls were expected to add 51k in September, so a print of 119k is a fantastic beat, but a two-month revision subtracting 33k dampens the effect of that beat dramatically. Meanwhile unemployment was expected to come in at 4.3% but ultimately printed at 4.44%. While the official probability of a December rate cut sits at 34.9%, the combination of yesterday’s FOMC minutes, which showed that “many” Fed members were opposed to a further cut, and this kind of mixed messaging in the labor market has led to many traders resigning themselves to the reality that a cut is not coming.
What to Watch This Week…
- S&P Global Purchasing Managers Index on Friday 9:45AM
- Monex USA Online is always open
JPY ⇓
The Japanese Yen maintains its near 35-year low versus the Greenback this morning as the Bank of Japan takes its most hawkish stance in recent months. BoJ member Koeda indicated overnight that they could hike rates as soon as December, rather than in the new year as was anticipated. Japanese policymakers are in a difficult position as the Yen is approaching levels that could force the BoJ to intervene in the market to stabilize the currency.
CHF ⇓
The Swiss Franc is down marginally versus the Buck this morning as the drag of tariffs resulted in weak import/export numbers for October. Pressure continues to mount for Swiss National Bank officials to take steps to prevent further appreciation in the haven currency as it sits at some of the strongest levels of all time, but given that interest rates are already at 0.00% and there is heavy reluctance to bring them back into negative territory, intervention by the SNB is beginning to look like the only option.
