Significantly strong NFP number to hardly be a USD-positive argument – Commerzbank

The short excursion of EUR/USD to the area below 1.07 and of the USD Index (DXY) to the area above 102 did not last. The Bureau of Labor Statistics (BLS) labor market report is due for release today.  How USD-positive are strong US data? Economists at Commerzbank analyze the impact of NFP on the greenback.

BLS to announce an NFP figure of 320K

“The median analyst expects the BLS to announce an NFP figure of 320K. A significantly stronger number would hardly be a USD-positive argument. But honestly: I don't trust the currency market to think that much around the corner. After all, it did not manage to do so on Wednesday after the ISM data.”

“I fear that in a strong labor market report, the reflexes of currency traders are once again stronger than the intellect, so that first the dollar would rise. If it doesn't turn out that way, I take my hat off to the market's foresight.”

See – NFP Preview: Forecasts from 11 major banks, strength continues