Business Magazine

US Non-Farms Smashes Target Giving Some Much-Needed Dollar Strength

Posted on the 07 August 2017 by Forex News Shop @forexnewsshop

With the constant political uncertainty surrounding the US, the Dollar regardless of its positive data has struggled to exploit any positive news, however this changed following the release of July’s Non-Farm Payrolls allowing some much-needed Dollar strength.

US Non-Farms Beat Expectation

The Non-Farms number provided the USD with a much-needed shot in the arm following the latest round of non-Farm payrolls. Markets had anticipated 182,000 jobs to be added to the US economy however the number beat expectation with 219,000 new work placements added.

The number was over shadowed by June’s results which reached 231,000 and provided some long-awaited Dollar strength. Regardless of July’s numbers being eclipsed by the previous month markets got the desired effect. One of The Federal Bank’s keystones for raising interest rates is a strong labor market and with non-farms; the key indicator for US job creation providing an above estimate reading in 3 of the last 5 months you would imagine the FED will come under more pressure to raise rates at least by the end of the year and in the nearer term will start tapering their $4.2BN Treasury Bond portfolio.

Unemployment Rate and Average Hourly Earnings

Thankfully US unemployment numbers didn’t over achieve, the reading provided a steady and anticipated 4.3%. Unemployment in the US now finds itself equalling a 16-year low which was set in May. With unemployment declining from a year high of 4.8% in February.

With employment in the US in great shape another objective for the FED was to achieve sustainable wage growth and August’s figures will go some way towards that. August’s average hourly wage growth increased from 0.2% last month to 0.3% this month, the equivalent of nine cents in monetary terms.

Fridays US Jobs Data Provided Much Needed Dollar Strength

The US Dollar has struggled against a basket of currencies in recent months. The majority of its weakness was due to political uncertainties rather than a weak economy. The FED have also been unwilling to taper and have adopted more of a ‘toe dip in water’ approach delaying an almost inevitable third interest rate hike and the tapering of their Treasury Bond portfolio. Friday’s data will undoubtedly comfort any FOMC members who are sat on the fence.

Following the trio of US data releases the US Dollar strengthened against a host of currencies including the Australian Dollar, Euro, Canadian Dollar and Pound.

The most notable correction was with AUD/USD which fell from 0.7970 to 0.7896 in the hours following the US jobs data. A contributory factor being the Reserve Bank Of Australia cutting next year’s GDP growth forecast from 3% to 2% late on Wednesday evening.

Dollar Strength AUD/USD Chart

The EUR/USD fell just as unceremoniously dropping from 1.1877 to 1.1739. The pair have now begun retracing much of the losses back, with EUR/USD closing at 1.1792 only just over a cent away from last week’s high of 1.1896.

Dollar Strength EUR/USD Chart

You Might Also Like :

Back to Featured Articles on Logo Paperblog

These articles might interest you :

  • Shilo Sanders- Son Of Deion Sanders Thanks Courts For Allowing Him To Live With...

    Shilo Sanders- Deion Sanders Thanks Courts Allowing Live With Pilar

    ChristianNews Shilo Sanders, the son of NFL Hall of Famer,  Deion Sanders took to twitter to “thank” the courts for allowing him to live with his mother, Pilar... Read more

    The 04 August 2017 by   Firstladyb
  • “I Feel Great”

    Feel Great”

    Jakub went to his doctor's office believing that he had a back injury, but returned with a chocking diagnosis instead. He had type 2 diabetes - in spite of... Read more

    The 04 August 2017 by   Dietdoctor
  • July Allotment Recap (2/2)

    July Allotment Recap (2/2)

    Sunday afternoon saw us return bravely to 24a even though there were more thundery showers foretold by the weatherman. I will admit that I guffawed at the... Read more

    The 04 August 2017 by   Chrryblossomtat2
  • Culinary Delicacies in Croatia- What to Eat and Drink in Croatia

    Culinary Delicacies Croatia- What Drink Croatia

    In my earlier post, we spoke about how Croatia is a stunning European destination, let us now see what are the culinary delicacies in Croatia or what you can... Read more

    The 04 August 2017 by   Kash Pals
  • #Golf Training Aids Spotlight: The Delta Putt

    #Golf Training Aids Spotlight: Delta Putt

    Do you consider yourself to be a strong putter or do you feel you could improve your make percentage on the green? Most amateurs could use help with the flat... Read more

    The 04 August 2017 by   Golfforbeginners
  • Three Incredible Hikes in Southern Iceland3 Min Read

    Three Incredible Hikes Southern Iceland3 Read

    Nature takes center stage in Iceland, where there's a stunning view around every bend: massive glaciers, expansive lava fields, powerful waterfalls, black sand... Read more

    The 04 August 2017 by   Healthytravelblog
  • What I Wore: Daytime Pajamas

    What Wore: Daytime Pajamas

    Pajama top: ELOQUII (14) | Pajama pants: ELOQUII (14) | Shoes: ASOS (similar) | Earrings: J. Crew ( same in different colors, similar concept in same color) |... Read more

    The 04 August 2017 by   Wardrobeoxygen