Friday’s wage report from the US Labor Department helped to send the US Dollar higher in European trading. The upbeat report, which showed average hourly earnings improving in December, could make the case for the three rate hikes that the Federal Reserve has promised. Disappointingly, the NFP report fell below expectations though the rise in the unemployment rate to 4.7% was anticipated by analysts. In the US, this week’s focus is likely to be President-elect Donald Trump’s news conference to be held on Wednesday during which he is expected to provide additional detail on his policies. Expectations are high that the Trump administration will provide more economic stimulus which has helped US equity and bond markets.
As reported at 10:43 am (GMT) in London, the EUR/USD was trading at $1.0509, down 0.14%; the pair has ranged from a session low of $1.0513 to a peak of $1.0555. The USD/JPY was higher at 117.082 Yen, a gain of 0.05%; the daily high was set at 117.5200 Yen while the low was at 116.8700 Yen. The GBP/USD pair was lower at $1.2154, a loss of 1.04%; the pair’s session low was struck at $1.2122 while the high was at $1.2271.
Pound Pressured by May Comments
The Pound Sterling is under heavy pressure following comments made by Theresa May, the Prime Minister, which were taken by markets as a suggestion that Britain could be facing a “hard Brexit.” May had suggested that a complete leave-taking from the EU could be possible as she didn’t see the need to maintain “bits of membership.” That would mean essentially reworking existing trading ties to a greater extent which is worrying markets.