Forexlive Americas news wrap: Another solid US jobs report

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Forex news for NY trading on September 7, 2018

In other markets:

Spot gold is down -$3.39 or -0.29% at $1196.50
WTI crude oil settled the week at $67.75. CLICK HERE
Bitcoin had a quieter day today (after a couple days of big declines). The digital currency is trading down -$17.61 at $6425. The price fell back below the 100 day MA this week at $6871.51. That level is now a risk defining level for shorts.

The US stock indices ended the day lower today. European shares were mostly lower although the German Dax and France Cac ended the day with small gains.

The US debt market is ending with sharply higher yields with the yield curve flattening a bit after the solid US jobs report. The 2-10 spread – which dipped below the 20 bps level last week – narrowed by 0.4 bps to 23.6 bps.

In the European debt market, the benchmark 10 year yields ended the day with mostly higher yields.

The USD is ending the day as the strongest currency. It also was the strongest currency of the majors for the trading week as well (see post here). The weakest currency today was the AUD (lowest level since early 2016). The NZD was also weaker. Those currencies were also the weakest for the week. The day ended with the same theme as the week.

Non Farm payroll rose 201K vs 191K expected.
2-month payroll revision -50K
Hourly wages 0.4% vs 0.2% exp..
Wages YoY 2.9% vs. 2.7% exp. Best YoY vs 2009.
Private payrolls 204K vs +194K expected
3 month average NFP 185K
Prior private payrolls 170K (revised to 153K)
Manufacturing -3K vs +23K exp
Unemployment rate 3.9% vs 3.8% expected
Prior unemployment rate 3.9%
participation rate 62.7 versus 62.9 last
Hours of work. 34.5 vs 34.5 last

You could nit-pick about the revisions. You can look at the unemployment rate moving to 3.9% vs 3.8% expectations. However wages came in better than expected, and that was the main catalyst for a higher dollar and expectations that 2 more hikes (one later in September and one in December) is likely.

Another benefit to the dollar was the aversion away from the AUD and NZD. Although Pres. Trump did not announce that the next $200B of tariffs on China goods was officially starting (the comment period ended yesterday), he did “see the $200B, and raised the tariff target an additional $267B” (see post here). That would bring the total just of $500B which is about the total of China exports to the US.

A weaker China economy as a result of the trade war (and potentially weaker global economy), is not good new for Australian and New Zealand who rely on exports to China for some of the GDP growth. As a result, most of the dollar gains has its roots in those two currencies today/this week. The EURUSD was also pressured today (down -0.54%).

….more

This article was originally published by Forexlive.com. Read the original article here.