EUR/USD bounced today, following two days of losses, as economic news from the United States (particularly nonfarm payrolls) was mostly disappointing. This may prompt the Federal Reserve to postpone the planned interest rate, and such prospects are negative for the dollar. Still, it will be hard for the euro to keep gains as tensions surrounding the situation in Greece intensify.
Nonfarm payrolls rose by 223k in June. It was not a bad figure by itself but a disappointing one to those market participants who were counting on a bigger growth by 231k. Moreover, the previous month’s reading was revised negatively from 280k to 254k. On a positive side, the unemployment rate fell from 5.5% to 5.3%, below the predicted level of 5.4%. Yet it was not an end to disappointing data as average hourly earnings did not rise last month while analysts predicted the same 0.2% rate of growth as in May. (Event A on the chart.)
Initial jobless claims were at 280k (seasonally adjusted) last week, frustrating those economists who promised them to be almost unchanged from the previous week’s rate of 270k. (Event A on the chart.)
Factory orders dropped 1.0% in May, two times the forecast drop by 0.5%. What is more, the previous month’s decline was revised from 0.4% to 0.7%. (Event B on the chart.)
If you have any comments on the recent EUR/USD action, please reply using the form below.
