NFP Preview: Eagerly awaited upbeat report to weigh on the dollar

The US will publish this Friday at 12:30 GMT its latest update on employment data. The country is expected to have added modest 850K new jobs in September, but signs said otherwise. Dollar acting as a safe-haven may continue to depend on sentiment with the NFP report, FXStreet’s Chief Analyst Valeria Bednarik reports.

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Key quotes

“Expectations are that the US has added 850K new jobs in September, weaker than the previous month’s total of 1.37M. However, analysts are also expecting the unemployment rate to have ticked down to 8.2% from 8.4% in the previous month.”

“The dollar is moving on sentiment. In this scenario, an upbeat report could play against the greenback, as stocks will likely advance. A disappointing number, on the other hand, could have the opposite effect, sending stocks lower and investors into the safe-haven dollar.”

“The pound is tied to Brexit headlines, which means GBP/USD could be the less interesting pair to trade within the NFP release. Commodity-linked currencies, on the other hand, have been quite responsive to risk-sentiment, and hence, maybe the preferred ones to play.”

“As for the EUR, the only reason for the pair to run is the dollar’s weakness. The shared currency is among the weakest high-yielding ones, which means a more interesting movement may take place should the report ends up boosting the dollar’s demand.”