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The US services sector is improving according to the fresh purchasing managers’ index by ISM: 53.7 points in August. Early expectations stood on a minor slide from 52.6 to 52.5 points.

EUR/USD traded at around 1.2575 before the publication, following Draghi’s dense announcement. The initial reaction is stable. USD/JPY is rising nicely, extending gains. It looks like the Non-Farm Payrolls will be quite good, looking at the early indicators.

The important part of this report is the employment component, which rose from contraction zone of 49.3 points up to 53.9. This is the highest level for this component since April. New orders slid, but are still in growth zone: above 50 points.

Earlier, ADP  reported  a gain of 201K jobs in the private sector – quite impressive. All the data for the Non-Farm Payrolls is now out.

Here is how to trade the Non-Farm Payrolls with EUR/USD. And even if you’re not trading the event, you can still play in Forex Live’s NFP contest here.

Chances of QE3 seem lower once again, but a lot depends on the NFP. It’s also important to remember that the German constitutional court decision is waiting on September 12th, as the FOMC begins its 2 day meeting.

Here’s another option for Bernanke and co.: extend the guidance.