What has changed after Friday’s US employment report?

Posted Monday, September 5, 2016 by
Skerdian Meta • 2 min read

Let me refresh you if you don´t remember or if you missed the US employment/unemployment report on Friday. The US unemployment rate missed the predictions and remained the same, there 151K new jobs created in August against 180K expected and the wages/salaries grew by 0.1% versus 0.2% expected. 

How does that look to you? You´re a forex trader so you must know what to the economic data means and how it is going to affect the forex market. All the three indicators missed the expectation so that must be negative for the USD, right? 

That´s the first impression you get when you just look at these numbers and that´s what the general thought was in the forex market immediately after the release. But, we must look beneath the surface to see what´s really happening and possibly get an idea of how things will evolve, at least in the near future. 

Yes, the economic indicators missed the expectations but maybe the expectations were overestimated. The unemployment rate missed the expectations but at 4.9% it is below the natural unemployment rate. Even though by 0.1%, the wages still grew despite being lower than anticipated. 100K new jobs a month is enough to provide vacancies for the rate of US population growth and many FED members and economists have mentioned that, so 151K is below expectations but more than it´s necessary. 

EUR/USD made a round trip after Friday´s US employment report and is sitting near the lows now 

So after all, these economic indicators still point up and the forex market was quick to realize this. The Buck reversed and ended the day up on Friday after an initial 100 pip decline. The guys at Goldman Sachs haven´t changed their minds about the September rate hike by the FED. They see Friday´s US employment report as positive and after Yellen´s "hawkish" comment a week ago they still see more upside potential for the USD. 

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