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Dollar rebounds as focus shifts to March NFP

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Following Wednesday’s sharp decline, the US Dollar Index (DXY) continued to push lower on Thursday, with the negative shift seen in risk sentiment, helping the USD stay resilient against its rivals.

US stock index futures are trading modestly higher early Friday after Wall Street’s main indexes lost over 1% on Thursday. Meanwhile, the benchmark 10-year US Treasury bond yield remains above, despite falling nearly 1% on Thursday.

A slowdown in non-farm payrolls is expected after a strong beginning of the year. When the NFP figures come out higher-than-expected, the USD tends to rally and vice versa when lower.

The data from Australia showed in the Asian session that exports declined 2.2% on a monthly basis in March, while Imports rose 4.8%. AUDUSD showed no reaction to these data and retreated below 0.6600 following a three-day rally.

EURUSD lost its traction after advancing toward 1.0900 and closed flat on Thursday. The pair continues to edge lower early Friday and was last seen trading below 1.0850.

GBPUSD rose above 1.2650 on Thursday, but reversed its direction to end the day marginally lower. The pair remains on the back foot in European trading and declined toward 1.2600.

USDJPY fell below 151.00 for the first time since March 21 on Friday before recovering above this level. The data from Japan showed that the Leading Economic Index improved to 111.8 in February from 109.5 in January.

Gold turned south after reaching a new record high above $2,300 on Thursday and closed the day in the red, snapping a seven-day winning streak.

XAUUSD extended its correction on Friday and was trading slightly below $2,280.

(Source: OANDA)