Traders expect the benchmark rate to fall by 50 points, while markets expect high volatility in currencies on Friday.
He global dollar The dollar fell against most major currencies on Thursday in a volatile session as investors prepared for Friday’s U.S. payrolls report, which could determine the path of U.S. interest rate cuts. Federal Reserve (Fed).
He dollar index —which measures the performance of the greenback against a basket of six internationally important currencies— fell 0.2% to 101.08 units. euro rose 0.2% compared to dollar and hit a one-week high of $1.1106. Against the Japanese yen, it fell 0.3 percent to a one-month low of 143.35 yen.
Meanwhile, the world markets are on edge and the stock markets, in particular, have been hit hard by weaker than expected data this week in USA, which revived concerns that growth prospects were less promising than previously thought and that the labour market could be slowing more than expected.
Market eyes on the Fed
Data on Thursday showed the number of Americans filing new claims for unemployment benefits unemployment declined last week as layoffs remained low.
The report helped allay fears that the labor market was deteriorating, after data released in the previous session showed that growth in private employment in the United States hit a three-and-a-half-year low in August.
Economists polled by Reuters expect a gain of 165,000 U.S. jobs in August, up from a gain of 114,000 in July. “There is an imminent sense that a recession is coming to the economy, but these latest numbers don’t show that,” he said. Adam Button, Chief FX Analyst at Forexlive in Toronto.
“I think the market is swinging between 25 and 50 basis points on each data point,” Button said. Markets are pricing in a 59% chance of a 25 basis point cut when the Fed meets Sept. 17-18, with a 41% chance of a 50 basis point cut, the tool showed. FedWatch CME. In total, about 100 basis points of cuts have been discounted for the year.
Source: Ambito
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