The greenback steadies as focus turns towards US non-farm payrolls
Trading ranges remain relatively narrow with changes among dollar pairs all being less than 0.1% as we begin the session. Markets are generally quiet with US equity futures slightly higher by 0.2% while Treasury yields are flat on the day.
There's only two things that traders will be watching out for in the day ahead and the first of which will be the US jobs report later at 1230 GMT.
We can all agree that US labour market conditions remain tight so the data here shouldn't tell us anything new but it's more of the fact that traders are waiting to see if there are any major surprises that could prompt an increase in the Fed rate cut odds.
Earlier in the week, we got a shock ADP employment report but that is mostly negated by the ISM non-manufacturing data, which showed a notable increase in the employment component. I reckon the latter is a more accurate reflection of what we'll see in the non-farm payrolls data later today.
The other thing that traders will be focusing on today is trade talks between US and Mexico. Headlines were all over the place overnight but ultimately, there is still no compromise just yet between both countries. Talks will continue again today with the threat of tariffs on Monday looming over markets to wrap up the week.
As such, expect a quieter session in the European morning as traders will have very little incentive to be chasing any key directional moves for the time being.
