US Dollar skyrockets following strong payrolls data

Pound (GBP) mixed amid lack of data

The Pound (GBP) traded without a clear direction on Friday as a lack of UK economic data left the increasingly risk-sensitive currency to be driven by market sentiment.

While GBP rose against riskier peers, it lost ground elsewhere as risk appetite faded.

Turning to today, the UK’s final services PMI for January is due this morning. Could confirmation of an expansion in business activity give GBP a leg-up?

Euro (EUR) edges higher amid risk-off mood

The safer Euro (EUR) rose against its weaker peers at the end of last week amid the bearish market mood.

However, the single currency’s strong negative correlation with the US Dollar (USD) put some pressure on EUR.

Today, the Euro could face headwinds. Confirmation of a contraction in Eurozone service sector activity and an expected decline in producer prices in the bloc could both dent the common currency.

US Dollar (USD) soars as jobs data beats forecasts

A hotter-than-forecast non-farm payrolls report catapulted the US Dollar higher on Friday as it signalled a robust American labour market.

The US economy added a huge 353,000 jobs in January, above expectations of 180,000 and the highest number in a year. In response, markets drastically adjusted their bets on a March rate cut from the Federal Reserve, thereby turbocharging USD.

Looking ahead, the latest ISM services PMI is due out this afternoon. Could an expected improvement in activity see USD rise even higher?

Canadian Dollar (CAD) boosted by USD correlation

The Canadian Dollar (CAD) was propelled higher by its positive correlation with USD on Friday. A drop in oil prices may have limited the crude-linked currency’s success.

This afternoon, Canada’s latest services PMI is due to be published, with an expected decline in activity potentially weighing on CAD exchange rates.

Australian Dollar (AUD) wobbles following mixed data

The Australian Dollar (AUD) wavered last night amid a raft of mixed economic data. While Australia’s services PMI exceeded expectations, weaker trade and inflation data capped the ‘Aussie’.

New Zealand Dollar (NZD) crawls higher amid improving mood

The risk-sensitive New Zealand Dollar (NZD) was also initially choppy overnight, although it eventually managed to trend slightly higher as the market mood improved.

Samuel Birnie

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