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A mixed  jobs report for November: 178K jobs gained within expectations, but wages fall 0.1%, worse than expected, y/y falls to 2.5%. The unemployment rate surprised with a drop to 4.6%, but the participation rate dropped as well. U-6 is at 9.3%, lowest since 2008.

The US dollar reacted negatively to the drop in wages, but as the dust settles, the greenback did manage to claw back and even eye a gain.

The US was expected to report a gain of around 175K jobs in November 2016 with +0.2% in wages. A rate hike on December 14th is all but priced in.

The US dollar was gaining a bit of ground ahead of the release, correcting the correction if you wish.

November NFP Data (updated)

  • Non-Farm Payrolls:  178K  (exp. +175K, last 161K before revisions)
  • Average Hourly Earnings -0.1% m/m, 2.5% y/y  (exp. +0.2% m/m, last month +0.4% m/m, 2.8% y/y, best since 2009)
  • Revisions: October revised to 142K, but September revised up, total: -2K, not much changed  (+44K last time).
  • Participation Rate: 62.7%    (62.8% last month )
  • Unemployment Rate: 4.6%, lowest since 2007  (exp.4.9%,  last month 5% before revisions)
  • Private Sector: 156K  (ADP showed 216K).
  • Real Unemployment Rate (U-6): 9.3%, lowest since 2008  (previous: 9.5%).
  • Employment to population ratio: 59.7%  (previous: 59.7%)
  • Average  workweek: 34.4  (last month: 34.4).

NFP Currency Reaction

  • EUR/USD traded around 1.0640,  within recent ranges and ahead of Italy’s referendum. It rises  above 1.0670 but retreats.
  • GBP/USD traded around 1.2625, enjoying hopes for a “soft-Brexit”. Cable rises  to 1.2640.
  • USD/JPY traded just under 114, off the highs after yet another rally. The pair wobbles but stabilizes.
  • USD/CAD was around 1.33, with the loonie continuing to ride the OPEC  accord. Canada also  releases its own jobs report, which is excellent. Dollar/CAD slides to 1.3280.
  • AUD/USD was around 0.7425, enjoying rises in commodity prices. No big changes are seen.
  • NZD/USD was at 0.71, also off the lows.

The preview: trading the NFP with EUR/USD