• US non-farm payrolls fall 247,000 in July; unemployment rate declines 0.1% to 9.4 from 9.5%, first fall in 17 months; average hourly earnings up 0.2%
  • Canada losses 44,500 jobs in July
  • White House still sees unemployment reaching 10%
  • IMF says Australian GDP to contract only 0.5% in 2009, applauds government action; Aussie dollar value in-line with fundamentals
  • Canada’s Ivey PMI eases to 51.8 in July from 58.2 in June, weaker than 54.0 expectations
  • ECRI index reaches 5-year high
  • President Obama says worst behind US
  • US consumer credit tumbles $10.3 bln in June; fifth straight monthly fall
  • US 10 year note closes up 11 bp in yield on the day, 37 bp on week
  • S&P 500 index rises to 2009 at 1010, up 1.3%
  • Oil falls $1.18 to $70.76, copper rises 1.24%, Gold falls $10 to $954.50

You could have leaked me the payroll figures today and I still would have lost a fortune. The knee-jerk “risk on” reaction to the improved US employment report was very short-lived. EUR/USD jumped to 1.4415 just after the figures but it was unable to hold above 1.44 for more than two minutes. By 8:38 am, EUR/USD was being thrown overboard with both hands. EUR/USD tumbled to 1.4270, bounced briefly to 1.4355 and then began sliding inexerably into the European close. The selling was particularly intense around the 15:00 GMT London fixing and again at 16:00 as London left for home. They set the low, at 1.4155. Rebounds held below 1.4200.

USD/JPY blasted through 96.00 after the figures and extended its gains as US interest rates backed up quickly. The market is betting that the Fed will refrain from further QE, while talk of Fed funds hikes as early as January is making the rounds. 97.00 resistance was overcome and the rally reached 97.79 before taking a breather.

GBP/USD’s rejection of the 1.7000 level earlier this week has medium-term bulls growing quite uneasy. Many have already headed for the exits but there is more to come.

Commodity currencies held up pretty well despite broad USD strength today (USDX up 1.2%). They don’t seem to care if the US or China leads the world out of recession as long as someone leads the world out of recession.

Have a restful weekend, all. I suspect we have plenty more forex volatility to look forward to early next week.