Currency Market Analysis

Oct 08, 2021 | Currency Market Analysis

Global Themes

Greenback steady with US jobs in focus

The USD was steady overnight as equity markets gained after US politicians agreed to extend the deadline on the US debt ceiling.

The US government had previously been due to lose authority to borrow in mid-October but this deadline has now been extended to December.

The negotiations will continue but for now markets jumped in a significant relief rally.

The US Dow Jones index gained 1.0% with the benchmark index now only down 2.2% from its August highs.

Commodities drive FX

The USDSGD held broadly steady overnight.

The euro and Japanese yen were both weaker.

The commodity currencies were the strongest and oil and other energy prices gained.

The Canadian and Australian dollars were best.

Unemployment rate watched

The main focus tonight is on the US non-farm payrolls due at 8.30pm.

The market is looking for 500k new jobs (source: Refinitiv).

The unemployment rate will be closely watched as government support programs end and participants re-join the job market. The market is looking for a fall back to 5.1%.

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