Forex Today: Optimism to prevail at the start of the week
What you need to know on Monday, August 9:
The greenback soared at the end of the week, ending it with gains against most major rivals, following an upbeat US Nonfarm Payroll report. The US added 943K new jobs in July, while the Unemployment rate contracted to 5.4%, both largely beating the market’s expectations. The Underemployment Rate shrank to 9.2%, while the Participation Rate increased to 61.7%. The better-than-expected employment report revived speculation the Fed will have to tighten its monetary policy sooner than anticipated.
Wall Street closed with gains, while US government bond yields edged higher, as optimism overshadowed chances of a tighter monetary policy in the US. The yield on the 10-year US Treasury note settled at 1.30%.
EUR/USD trades around 1.1760, while GBP/USD stands at around 1.3870, as the AUD/USD pair approaches its 2021 low.
Gold prices collapsed, with the bright metal losing roughly $35 to settle at $1,763.50 a troy ounce. Crude oil prices were also under selling pressure, with WTI ending the day at $67.90 a barrel.
Over the weekend, the US Senate advanced with the bipartisan infrastructure bill, although it still requires a final vote, which date remains unclear. Still, the headline should support the market’s good mood.
The Reserve Bank of Australia published the Minutes of its latest monetary policy meeting, which repeated that the board remains committed to maintaining financial support and that a rate hike would not be likely until 2024.
The focus in the Asian session will be on China, as the country will publish July inflation figures. On Saturday, the country published its July Trade Balance, which posted a surplus of $56.58 billion, slightly better than anticipated.
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August 8, 2021 at 06:08AM