06.12 .2019: USD perks up amid robust employment (USDX, USD/CAD)


The US Department of Labor released nonfarm
payrolls which surprised both pessimistic and optimistic analysts. The labor market revealed much stronger employment
than expected. Most market participants were braced for weak
hiring in November, bearing in mind downbeat data from the ADP payroll processor posted
on Wednesday. However, the government data revealed surprisingly
strong employment growth. Last month, the US economy added 266,000 new
jobs while analysts expected a modest increase of 181,000 new jobs. Moreover, the reading for October was upgraded
to 156,000 compared to 128,000 originally reported for the previous month. Investors also cheered an unexpected downtick
in the unemployment rate. The figure edged down to 3.5% in November
from 3.6% in October. Nevertheless, traders took little notice of
such upbeat data. Investors were also encouraged by acceleration
in the annual rate of wage growth to 3.1%. This information signals that headline inflation
could gain momentum soon. In other words, the Federal Reserve could
put monetary policy on hold at the nearest meeting next Wednesday. Inspired traders resumed buying the US dollar. As a result, the US dollar index rebounded
from a one-month low with an effort to regain losses. At the moment of recording this video, the
index won back 20 pips, having approached the resistance level of 97.70. The greenback is asserting strength the most
against its Canadian counterpart. The USD/CAD pair is steadily climbing to 1.3280. The loonie is losing ground in light of a
weak report on Canada’s labor market. Defying the forecast for employment growth
in November, the number of employed people is still declining. This time, Canada’s economy lost 71,000
jobs. Apparently, Canada’s economy is not as healthy
as it is viewed by the Bank of Canada. The new trading week is likely to start on
the positive note as investors are going to react to the strong nonfarm payrolls. So, the US dollar is set to extend growth. We wish you a nice weekend. See you back on InstaForex TV channel on Monday!

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