With Fireworks Over, All Eyes on U.S. Payroll Reports

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NFPThe Fourth of July fell out on a Thursday this year, which means that despite a national holiday, traders have kept their focus on the non-farm payroll report that will be released on Friday. The data is expected to confirm or deny expectations for an interest rate cut in July. According to Reuters, the report is expected to show the creation of 160,000 jobs, up from 75,000 in May. But no matter what the NFP report shows, analysts are expecting a day of low volatility in the New York trading session as traders enjoy a long summer weekend.

Trading in Asia on Friday was also slow, with benchmark indexes trading mixed in the early morning in Hong Kong. Japan’s Nikkei 225 saw a modest 0.03 percent uptick while Hong Kong’s Hang Seng Index was 0.04 percent lower as of 9:52 a.m. HK/SIN. South Korea’s Kospi eased 0.14 percent while Australia’s ASX 200 ticked upwards 0.18 percent. China’s two benchmark indexes, the Shanghai Composite and the Shenzhen Composite, were down 0.24 percent and 0.06 percent respectively.

Currency Markets Remain Subdued

As expected in the post-holiday trading session, the currency markets remained mostly stable and saw little volatility during the first half of he Asian trading session. The dollar index was up 0.01 percent just after 10 a.m. in Hong Kong, trading at 96.77 .DXY. The greenback gained 0.02 percent against the yen to trade at 107.81. The dollar also firmed slightly against the British pound and the euro. The euro’s mild weakening was credited to the appointment of Christine Lagarde, current International Monetary Fund Managing Director, as the next president (and first female president) of the European central bank. Lagarde has long been considered a policy dove, and she is credited for helping reinstate confidence in the IMF after the Greek bailout a few years ago. Lagarde has a history of disdain for U.S. President Donald Trump, so it will remain interesting to see how her nomination will impact the relationship between Trump and the IMG.

Sara Patterson has a Master’s Degree in political science and enjoys analyzing both current events and the international markets to get a fuller perspective of the currency market. Before turning to financial writing, she taught English writing skills to high-school age students. Sara’s work has been published on various financial and Forex blogs.