- Euro recovery extends to 0.9960 and erases losses from the previous four days.
- US unemployment and wage growth data send the US dollar tumbling.
- EURUSD: Further decline to 0.9500 is still likely – Rabobank.
The euro has squeezed higher during Friday’s US afternoon trading, with the pair reaching session highs at 0.9960 so far. The common currency has erased the previous four days’ losses with a shocking 2.2% daily rally, turning positive on the weekly chart.
US unemployment and wage growth data have crushed the dollar
The US Dollar accelerated its downtrend earlier today, following the release of October’s employment report. Non-Farm Payrolls data have beaten expectations with a 261K reading, beyond the 200K consensus, and with September's record revised up to 315K from 264K.
On the other hand, the unemployment rate increased to 3.7%, from 3.5% in September, and wage inflation slowed down to 4.7% from 5%. These embryonic signs of a potential easing in the labor market conditions have brought back the theory of slower rate hikes in December, sending the US dollar tumbling across the board.
EURUSD: A decline to 0.95 is still likely– Rabobank
Currency analysts at Rabobank remain bearish on the pair and maintain their view of further decline towards 0.9500: “It is our view that the EUR is not fully priced for the headwinds facing the Eurozone economy (…) We continue to see risk of a fall in EURUSD to 0.95 in the weeks ahead and see the potential for the EUR to stay weaker for longer vs. the US Dollar.”
Technical levels to watch
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