EUR/USD – Euro Steady Ahead of US Nonfarm Payrolls, Wage Growth

The euro continues has ticked lower in the Friday session. Currently, EUR/USD is trading at 1.1644, down 0.09% on the day. On the release front, there are no eurozone indicators on the schedule. Employment data will be in the spotlight on Friday, as the US releases Average Hourly Earnings, Nonfarm Payrolls and the unemployment rate. The markets are expecting NFP to rebound to 311 thousand, but Average Hourly Earnings is forecast to slow to 0.2 percent. No change is expected in the unemployment rate, with an estimate of a sizzling 4.2 percent. As well, the US releases ISM Non-Manufacturing PMI, which is expected to drop to 58.5 points.

A strong manufacturing sector has been an important factor in the stronger eurozone economy, and September Manufacturing PMIs continue to point to expansion early in the fourth quarter. The German Manufacturing PMI held at 60.6, its highest level since April 2011. Eurozone Manufacturing PMI also pointed to strong expansion and accelerated for a third straight month. The German employment market remains robust, as unemployment rolls have declined for three straight months. Unemployment rolls have now dropped in all but two readings since June 2015.

There were no surprises from the Federal Reserve on Wednesday. The Fed’s rate statement was little more than a run-up to the December rate decision, as the Fed maintained interest rates at a range of 1.00 percent to 1.25 percent. The Fed indicated that a rate increase is very likely at the December meeting, and was careful not to change any of the wording in its statement regarding future rate hikes. The rate statement noted that hurricanes which hit the US had caused a decline in payrolls in September, but the Fed did not expect the hurricanes to “materially alter the course of the national economy over the medium term.” The markets are expecting a strong rebound in nonfarm payrolls – the forecast for US nonfarm payrolls is a robust 311 thousand, after a decline of 33 thousand in September. Still, wage growth, which has remained soft despite the strong economy, is expected to slow to 0.2 percent, as inflation remains the Achilles heel of a robust US economy.

EUR/USD Fundamentals

Friday (November 3)

• 8:30 US Average Hourly Earnings. Estimate 0.2%
• 8:30 US Nonfarm Employment Change. Estimate 311K
• 8:30 US Unemployment Rate. Estimate 4.2%
• 8:30 US Trade Balance. Estimate -43.3B
• 9:45 US Final Services PMI. Estimate 55.7
• 10:00 ISM Non-Manufacturing PMI. Estimate 58.5
• 10:00 US Factory Orders. Estimate 1.3% 
• 12:15 US FOMC Member Neel Kashkari Speaks

*All release times are GMT

*Key events are in bold

EUR/USD for Friday, November 3, 2017

EUR/USD for November 3 at 5:50 EDT

Open: 1.1659 High: 1.1668 Low: 1.1640 Close: 1.1648

EUR/USD Technical

EUR/USD inched higher in the Asian session but has retracted in European trade

• 1.1611 is providing support
• 1.1712 is the next resistance line

Further levels in both directions:

• Below: 1.1611, 1.1489 and 1.1366
• Above: 1.1712, 1.1876, 1.1996 and 1.2018
• Current range: 1.1611 to 1.1712

OANDA’s Open Positions Ratio

EUR/USD is showing little movement in the Friday session. Currently, short positions have a majority (63%), indicative of EUR/USD reversing directions and moving upwards.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.