- Non-farm payrolls +200K vs +150K exp
- Unemployment rate 8.5% vs 8.7% exp
- Canada loses 25.5K full-time jobs, adds 43.1K part time workers
- Fed’s Dudley (voter) more accommodation appropriate
- Fed’s Rosengren (non-voter) says Fed should by more MBS
- Hungary downgraded to junk, PM complains
- Monti: Unicredit problems due to “temporary” issues, Italian banking strong, will balance budget in 2013
- Sarkozy: France prepared to unilaterally implement transaction tax
- ECB’s Asmussen okays bond buys with limited scope
- Citigroup: ECB to cut refi rate to 0.50% by June
- S&P 500 down 0.2% but gains 1.6% on the week
- JPY and USD lead; CAD and EUR lag
The market continued to look for reasons to buy USD. Headlines on non-farm payrolls were strong and an initial drop in EUR/USD was said to be due to a new, positive correlation between US economic data and USD. A closer look at the NFP data showed an outsized gain in holiday-related shipping jobs that is likely to be reversed. As sentiment deteriorated flows continued into USD, sending EUR/USD below 1.27 for the first time since September. What’s clear is that any reason is a good reason to sell EUR at the moment.
It’s a new year but nothing much has changed in USD/JPY. The pair popped 20 pips to a session high of 77.33 after NFP and then drifted lower for the remainder of the session, closing near the lows at 76.99.
The Canadian dollar lagged on a disappointing employment report, even with US oil gaining climbing 2.8% on the week, CAD was down a full cent. USD/CAD climbed right into the final trades, closing at the highest since mid-December.
