NFP report unlikely to put pressure on US dollar – Commerzbank
The question is whether the Federal Reserve would continue to sound so hawkish if the labor market weren’t so strong. Commerzbank economists say nonfarm payrolls due for release later today are unlikely to cause concern at this time.
There is no real alternative to the dollar
“Today’s data is unlikely to cause concern at this time. Momentum has probably eased a bit, but the labor market is likely to be tight enough that the Fed sticks to its plan to continue raising interest rates significantly.
“If the NFP report disappoints, the reaction of Fed members would be decisive. If the rhetoric does not change, there is no reason to trade the lower USD first. Especially since there is no real alternative to the dollar at present, as we explained earlier in this publication.
“September consumer price data is due out next week. If there is no improvement on the price front, the Fed should stick to its hawkish communication even if the labor market were to disappoint today. Against this backdrop, the USD should remain supported for now.
See – NFP Preview: Nine Big Banks Forecast, Employment Trend Slows