USD

The US dollar staged a strong rally on Friday, as the latest NFP report came in much stronger than expected. 

The economy added 257K jobs for January, higher than the projected 236K increase. On top of that, the previous reports were also upgraded, amounting to around 150K additional hiring gains. The jobless rate ticked up from 5.6% to 5.7%, spurred by a stronger participation rate. Wage growth was also seen, as average hourly earnings ticked up by 0.5% in January. There are no major reports up for release from the US economy today, suggesting that the upbeat jobs figures could continue to keep the dollar supported.

EUR

The euro was once again in a weak spot, as medium-tier data came in weaker than expected on Friday. German industrial production picked up by only 0.1% instead of showing the estimated 0.4% gain while the French trade balance showed a wider deficit. The German trade balance is up for release today, along with the euro zone Sentix investor confidence report.

GBP

 The pound gave back some of its recent gains to the dollar when the UK trade balance came in weaker than expected. The report showed a deficit of 10.2 billion GBP versus the projected 9.0 billion GBP shortfall while the previous reading was downgraded. There are no reports due from the UK today, which means that risk sentiment might drive pound price action.

CHF

 The franc managed to hold its ground last Friday, as the Swiss retail sales report surprised to the upside. The report printed a 2.2% annualized gain versus the projected 0.4% uptick while the previous figure was upgraded to show a smaller decline. There are no reports lined up from Switzerland today.

JPY

 The yen gave back some of its recent wins, as yen pairs took their cue from the strong rally in USDJPY. Data from Japan was upbeat, as the leading indicators reading improved from 103.9% to 105.2%. Earlier today, the current account balance came in slightly above expectations and printed a 0.98 trillion JPY surplus. No other reports are due from Japan, which means that yen pairs might be driven by market sentiment.

Commodity Currencies (AUD, NZD, CAD)

 The comdolls gave back some of their recent gains to the dollar, as higher-yielding US equities also retreated. Canada’s headline jobs figures came in stronger than expected, as the employment change showed a 35.4K gain while the unemployment rate held steady at 6.6%. However, underlying figures show more weakness and significant downward revisions to previous releases. Earlier today, Australia reported a 1.3% gain in ANZ job advertisements, weaker compared to the previous 1.8% gain.

By Kate Curtis from Trader’s Way