🔍 [FX Strategy Report] Can the U.S. Jobs Report Shift the Trend? A Crucial Test for Dollar Strength
📌 U.S. Jobs Report: A Key Indicator for the Dollar’s Direction
The July Nonfarm Payrolls report, to be released today, is likely to set the tone for the market following the FOMC meeting.
| Indicator | Forecast | Previous | Market Focus |
|---|---|---|---|
| Nonfarm Payrolls | +104K | +147K | Public sector hiring slowdown expected to drag down growth |
| Private Payrolls | +100K | +74K | Modest improvement expected—signs of recovery? |
| Unemployment Rate | 4.2% | 4.1% | Any uptick could signal labor market weakening |
| Avg. Hourly Earnings (MoM) | +0.3% | +0.2% | Watch for signs of wage-driven inflation |
| Avg. Hourly Earnings (YoY) | +3.8% | +3.7% | A stronger figure may influence Fed outlook |
📣 Strategic Perspective:
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If data is in line or stronger → Continued dollar buying; potential USD/JPY break above 150
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Weak data or rise in unemployment → Rate-cut expectations may resurface; risk of dollar pullback
💹 Dollar Index (DXY) Trend
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Previous close: 99.968
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Today’s high: 100.171 (+0.19%) – Highest since late May
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Recovered during the London session after briefly falling to 99.91 earlier in the day
📌 Position adjustments are underway ahead of U.S. data; direction will depend on the NFP outcome.
📆 Key Economic Events Today (Friday, August 2)
| Region | Event |
|---|---|
| 🇪🇺 Eurozone | Final Manufacturing PMIs (July) |
| 🇪🇺 Eurozone | Flash HICP (CPI) |
| 🇧🇷 Brazil | Industrial Production (June) |
| 🇺🇸 U.S. | Employment Report, ISM Manufacturing, Construction Spending |
| 🇺🇸 U.S. | Final University of Michigan Consumer Sentiment |
🎙 Fed Comments & Earnings in Focus
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Remarks from Fed’s Harker and Bostic
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Earnings from Chevron, ExxonMobil, and other U.S. energy majors
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U.S. Treasury’s Quarterly Refunding Plan may impact bond supply-demand dynamics
🧭 Summary & Outlook
While the dollar trend remains intact after the FOMC, today’s jobs data is a pivotal moment. Markets currently expect a “not too hot, not too cold” scenario, but surprises in wage growth or the unemployment rate could trigger major FX reactions.
USD/JPY remains capped at the 150 threshold. However, continued yen weakness, political uncertainty, and the BoJ’s dovish tone suggest downside is limited.
