October 8, 2021

NFP Predicted Strong, USD Will Rocket?

 The greenback is moving flat as the market awaits the release of the U.S. NFP jobs report that could provide an indication of the Federal Reserve’s (Fed) timeline to start tightening stimulus.

At the time of writing, the dollar index is trading steady around 94.20, not far from its one -year high against most major currencies.

Market sentiment was seen improving after U.S. Senate Majority Leader Chuck Schumer announced that a deal had been reached to raise the debt ceiling to $ 408 billion by early December.

The announcement has lifted sentiment and pushed major currencies and US equities to trade positive. However, overall greenback dollar trading is still strong.

The market’s focus is now focused on the NFP jobs report to be published tonight, where it is expected to show an increase of around 500,000 in September.

The Fed previously said it would likely start reducing its monthly bond purchases as early as November and then be followed by a rate hike next year.

Meanwhile, the euro traded little changed around 1.15570 against the USD, while the pound gained little support to rise above 1.3600 following market relief on gas price pressures in the UK.

Positive sentiment also pushed commodity currencies, the Aussie dollar, kiwi and Canada to appreciate against the USD.