What you need to know on Friday, January 21:
The greenback traded with a soft tone on Thursday, ending the day mixed across the FX board. The EUR was among the weakest, while the AUD and the CAD were the strongest.
Disappointing US employment-related figures were behind the broad dollar’s weakness at the beginning of the American session, as weekly unemployment claims unexpectedly jumped to 286K in the week ended January 7, the highest reading since late in October. Like most major developed economies, US workers and businesses are struggling with Omicron-related disruptions.
The US Federal Reserve relies on what it calls “the jobs market at close to full employment” to accelerate an aggressive reduction of its financial support to tame inflation. The unexpected increase in unemployment claims may be just a one-off, but if it keeps rising, the Fed may have to put a break. The central bank is having a monetary policy meeting next week and will unveil the outcome on Wednesday, January 26.
US Treasury yields remain stable through the day, with the yield on the 10-year Treasury note at 1.83%. Stocks, on the other hand, managed to advance, with all US indexes trading in the green heading into the close, although they retreated from intraday highs.
The EUR/USD pair trades around 1.1310, while GBP/USD hovers around 1.1620. The AUD/USD pair peaked at 0.7276, now trading around 0.7240, while USD/CAD stands at 1.2474. The USD/JPY pair is marginally lower at around 114.15.
Gold is ending the day pretty much unchanged, around $1,840 a troy ounce but managed to post a fresh two-month high of $ 1,847.92 a troy ounce. Meanwhile, crude oil prices surged to fresh multi-year highs, with WTI touching $87.08 a barrel but ending the day at around $85.20.
Facebook and Instagram join the NFT mania
Like this article? Help us with some feedback by answering this survey:
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD sticks to half-yearly highs of 0.6740 ahead of US NFP
AUD/USD consolidates near a multi-month peak at 0.6740 in the Asian session on Friday as traders keenly await the the US NFP report. The Fed-RBA policy divergence continues to underpin the pair.
USD/JPY falls hard toward 160.50, US NFP data awaited
USD/JPY is falling hard toward 160.50 in Asian trading on Friday, having reversed from near 161.40. The pair drops on renewed US Dollar weakness and Japanese verbal intervention, which rescues the Yen. The focus shifts to US jobs report.
Gold price steadily climbs back closer to two-week high, focus remains glued to US NFP
Gold price extends its consolidative price move during the Asian session on Friday and remains well within the striking distance of the highest level since June 21 touched earlier this week. The recent softer US macro data reaffirmed market bets that the Federal Reserve will begin cutting rates in September.
Is the party over for meme coins?
According to Santiment's data on Thursday, meme coins have experienced steep declines in the past few weeks, following speculation that the crypto market has passed its euphoria phase.
US jobs report preview – Will Nonfarm Payrolls disappoint?
Will the July Nonfarm Payrolls report disappoint, sending stocks and the US Dollar lower? Let's take a look at what the signal is from the other labor market indicators because forex fundamentals matter for trading.