FX Daily: Volatility from US nonfarm payrolls today


Also wary of growth risks from Delta-variant
Philip Wee03 Sep 2021
    Photo credit: Unsplash Photo




    DXY depreciated 0.5% since last Friday, wary that US nonfarm payrolls (NFP) may disappoint today.
    Except for the big miss in April, DXY did not post a weekly depreciation for this year’s NFP releases. After the disappointing ADP employment data for August (374k actual vs 625k consensus), NFP is now expected come in at 725k in August, down from the 750k projected on Monday. Investors who champion record-breaking US stock indices are pinning their hopes on the fall in initial jobless claims to support NFP. They are also keeping their fingers crossed that the ISM services employment index did not follow manufacturing into the red below 50. 



    US stock markets futures point to a flat-to-weaker open today. The optimism in record high US stock indices on a dovish Fed taper outlook is running up against US growth slowdown risks from the Delta-variant. As per the Atlanta Fed GDPNow model, the projection for 3Q growth dropped in single day to 3.7% from 5.3%. Pay attention to ISM PMI services too that it does not surprise on the downside like the Conference Board consumer confidence index did on Monday. A volatile session is likely into and after the US jobs report.










    Philip Wee

    FX Strategist - G3 & Asia
    philipwee@dbs.com
     

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