💱 FX Market Shaken Ahead of U.S. Jobs Data | ISM Uptick & Sterling Selloff in Focus
🌍 Global Market Environment
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U.S. and Canadian markets were closed yesterday for Labor Day; liquidity was thin.
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This week’s focus is squarely on Friday’s U.S. Nonfarm Payrolls (NFP).
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The last NFP shocked markets with major downward revisions, cementing expectations for a 25bp September rate cut.
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If this week’s report is even weaker, markets may start to price in a 50bp cut.
U.S. Data Calendar (key releases ahead of NFP):
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Sep 3: JOLTs Job Openings, Factory Orders
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Sep 4: ADP Employment, ISM Services, Weekly Jobless Claims
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Sep 5: Nonfarm Payrolls (NFP)
📊 Today’s Key Indicators
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U.S. ISM Manufacturing PMI (Aug): Expected 49.0 (vs. 48.0 prior). Still in contraction, but any improvement could support the dollar.
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Eurozone CPI Flash (Aug): Headline +2.1% y/y, Core +2.2% y/y expected.
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ECB meeting (Sep 11) → on hold is consensus. A CPI upside surprise could offer the euro temporary support.
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💵 FX Market Moves
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Tokyo Session
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BoJ Deputy Gov. Himino’s cautious tone → yen selling.
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Solid 10-year JGB auction lowered yields, adding yen pressure.
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USD/JPY climbed into the 148 handle.
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London Open
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Broad-based dollar buying, with sterling leading the decline.
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U.K. gilt yields surged, fiscal concerns sparked sharp pound selling.
Key moves:
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GBP/USD: fell 1.3530 → 1.3439
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EUR/USD: broke below 1.1700 → hit 1.1671
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USD/JPY: rallied to 148.53
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U.S. 10y yields: 4.24% → 4.27%
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📊 Major FX Pairs | Ranges & Strategy Scenarios
| Pair | Expected Range | Short-Term Scenario | Medium-Term Scenario |
|---|---|---|---|
| USD/JPY | 147.00 – 148.80 | Buying interest below 147.30; profit-taking above 148.50 | Weak NFP → break under 146.00; strong NFP → retest 150.00 |
| EUR/USD | 1.1650 – 1.1750 | Selling into rallies; heavy resistance near 1.1700+ | Weak NFP → test 1.1800; strong NFP → risk of 1.1600 break |
| GBP/USD | 1.3430 – 1.3550 | Fiscal concerns cap gains; selling pressure above 1.3500 | U.K. weakness could extend losses; sub-1.3400 opens deeper downtrend |
| EUR/JPY | 171.50 – 173.00 | Bearish bias under 172.00; 173.00 acts as resistance | Euro weakness could drag toward 170.00; broad USD weakness could lift to 174.00 |
| GBP/JPY | 198.00 – 200.00 | Selling pressure around 199.00; dip-buying near 197.50 | 200.00 seen as a ceiling; fiscal risks limit upside sustainability |
✅ Key Takeaways
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USD/JPY: Trading heavy at 148.50; ultimate direction tied to Friday’s NFP.
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EUR/USD: ECB rate-cut expectations cap rallies; 1.1600 is the key defense.
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GBP/USD & GBP/JPY: Fiscal risk weighs, 200.00 in GBP/JPY is a ceiling.
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Cross-yen: Driven largely by dollar moves; risk-on equities can add yen selling flows.
