November 5, 2021

USD Rockets Higher Ahead Of NFP, Are You Safe To Trade?

 The U.S. dollar continues to move higher as the market draws closer to the publication of U.S. NFP employment data.

In the European session, the greenback dollar sank its other major rivals lower, bringing it back close to a one -month high at around 94.45.

The giant has previously received support from the Federal Reserve's (Fed) decision to reduce its monthly asset purchases, as well as the weakness of several major currencies.

However, investors remain cautious as the NFP employment report will be published in the New York session and there is a risk of profit-taking ahead of weekend trading.

In addition, the euro continued to weaken to a one -month low against the strong US dollar.

Meanwhile, the pound extended its decline to a one -month low against the US dollar after being disappointed by the decision of the Bank of England (BOE) to keep interest rates unchanged at its latest policy meeting.

BOE Governor Andrew Bailey in his latest statement said that they had not promised to raise interest rates in November, indicating that previous expectations of a rise were merely market speculation.

The pound has also come under pressure from rising tensions between the UK and the European Union (EU) over post-Brexit issues.

There is a growing expectation that the UK will apply Article 16 protections, which allow both parties to suspend the agreement if it has a negative impact.