EUR/USD rallied today after US nonfarm payrolls matched expectations. Market analysts speculated that it is because the slowing employment growth and escalating US-China trade conflict led to speculations that the Federal Reserve will have to cut interest rates again in September.
Nonfarm payrolls rose by 164k in July, matching forecasts exactly. June’s increase got a negative revision from 224k to 193k. Unemployment rate remained unchanged at 3.7%, whereas analysts had predicted a decrease to 3.6%. Average hourly earnings rose by 0.3%, the same as in the previous month, while experts had predicted a smaller increase of 0.2%. (Event A on the chart.)
Trade balance was at $55.2 billion in June, down slightly from $55.3 billion in May. Economists had forecast a much bigger drop to $54.2 billion. (Event A on the chart.)
Michigan Sentiment Index rose to 98.4 in July from 98.2 in May according to the revised estimate, unchanged from the preliminary estimate and in line with expectations. (Event B on the chart.)
Factory orders rose by 0.6% in June, matching the market consensus. May’s drop got a negative revision from 0.7% to 1.3%. (Event B on the chart.)
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