All Eyes on the NFP

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USD Data On Watch

The US dollar has seen much quieter trading over the last 24 hours as traders await the final key data of the week: the US employment reports due later today. While USD has continued to trade lower into the end of the week, downside momentum has reduced. The USD index trades 97.38 last. Looking ahead to today’s data, the NFPs are forecast at 181k while average hourly earnings are forecast to increase to 0.3% from 0.2% prior. The unemployment rate is forecast to remain unchanged at 3.6%.

EUR Pauses

EURUSD upside has stalled today in light of the pause in the USD sell-off. With no tier-one EUR data due today, flows are likely to remain tied to the outcome of US data later today. Earlier in the week, new ECB chief Lagarde reaffirmed market expectations that the ECB will continue Draghi’s accommodative monetary policy approach. EURUSD trades 1.1102 last.

UK Elections Continue To Drive GBP

GBPUSD has softened a little over the European morning on Friday retracing from the recent highs traded yesterday to trade 1.3125 last. GBP has been higher this week as polls continue to show Johnson’s Conservative party firmly in the lead. The resignation of four key Brexit Party MPs (who called for supporters to back Johnson) has also helped boost expectations o a Conservative party win. This is keeping the focus on Johnson’s Brexit deal.

Risk Sentiment Strong on Friday

Risk assets have been firmer into the end of the week with SPX500 recovering firmly off the lows printed earlier in the week. Expectations regarding the prospect of a US/China deal have improved again. This is following reports from China that, despite tensions over the Hong Kong protests, talks remain ongoing. SPX500 trades 3124.03 last, heading back up to the 3132.56 last.

Safe Haven Flows Reduced on Equities Recovery

Safe havens have been lower over the European morning on Friday. The ongoing recovery in equities prices has seen weaker safe-haven flows. Both JPY and gold are lower against the USD on Friday. USDJPY trades 108.64 last, moving lower beneath the 108.84 level. XAUUSD trades 1474.41 last, still sitting beneath the broken 1481.93 level for now.

OPEC Increases Production Cuts

Oil prices have been higher today on the back of yesterday’s OPEC+ meeting. OPEC and a group of external producers, including Russia, yesterday agreed to step up the production cuts. These cuts have been running since January. The cuts, which were initially at 1.2 million barrels per day, will be increased to 1.7 million barrels per day. Though, as yet, no further extension has been seen in the duration of the cuts which are due to finish by the end of Q1 next year. Trading 58.40 last, crude has not seen the upside many were expecting. Price is still capped by the 58.61 level for now.

Loonie Lower As Crude Boosts CAD

USDCAD has been a little lower today with crude upside keeping CAD supported. Along with key US data later today, traders are also waiting on the Canadian unemployment rate which is expected to have remained unchanged at 5.5% last month. USDCAD trades 1.3173 last, just off the week’s lows at 1.3158.

Aussie Holding On

AUDUSD has been higher over the final European morning of the week with price trading .6845 last. A more optimistic tone from the RBA this week, as well as resilience in expectations over the prospect of a US/China trade deal, is helping keep the Aussie supported despite weaker retail sales and trade balance data yesterday.

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