Article Highlights

  • US non-farm payrolls at 175K vs. 149K expected
  • US unemployment rate rises from 6.6% to 6.7%
  • US average hourly earnings up by 0.4%
  • US trade deficit inches higher to $39.1B vs. $39B last month
  • CA unemployment rate still at 7%
  • CA non-farm employment change prints at -7K vs. 15K expected
  • CA trade deficit at -0.18 billion CAD vs. -1.2 billion CAD estimates
  • China’s inflation slips from 2.5% to 2.0% in February
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NFP Fridays have always provided good trading opportunities for the major currency pairs and last Friday’s price action did not disappoint!

The dollar started the trading session on the green side of the charts after Uncle Sam showed that a net of 175,000 workers had found jobs in February. Average hourly earnings also ticked 0.4% higher, its fastest pace in 8 months. In addition, the previous months’ readings were also revised higher with January’s numbers adjusted from 113,000 to 129,000 and December’s report adjusted from 75,000 to 84,000.

As it turned out, the report was just enough to support the Fed’s current taper schedule without sparking fears that the central bank would soon pick up its pace. Meanwhile, investors mostly shrugged off the uptick in unemployment rate even though the participation rate remained steady at 63%.

Overall the good vibes from the U.S. boosted the dollar by at least 50 pips against the euro, pound, yen, and the franc in the first hour of the release. The Loonie was also notably weaker against the Greenback after Canada’s weak employment numbers offset the positive IVEY PMI and building permits released earlier in the week.

The markets started to reverse a few hours into the U.S. session as investor focus turned back to concerns in Ukraine. Russian natural gas giant Gazprom threatened to suspend gas supply to Ukraine after it had missed its February payments. Although the company isn’t threatening Europe’s supply, the warning was enough to cause concerns among the euro and pound bulls. Risk appetite retreated for the rest of the day and the major dollar pairs ended the trading session back at their session open levels.

That’s it for the U.S. session recap! Up ahead we have a data dump from Japan that includes its final GDP and current account numbers at 11:30 pm GMT. We don’t have any major news scheduled from China or Australia but keep your eyes peeled in case last Friday’s price action carries over to today’s Asian session trading!

See also:

London Session Recap

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