EUR/USD holds its ground in the North American session on Thursday, although it has experienced consecutive bearish days as the US Dollar gains strength due to the ongoing government shutdown and the lack of US economic data releases such as Initial Jobless Claims. The currency pair is currently trading at 1.1719, reflecting a decrease of 0.09%.
The EUR/USD pair experiences a significant decline as the Dollar strengthens, following the US government shutdown that interrupts essential economic data releases. Dallas Fed Logan highlights the upward trend in inflation and cautions about associated risks, as the labor market exhibits additional signs of cooling. Eurozone unemployment has unexpectedly increased to 6.3%, which adds pressure to the ECB’s outlook as growth risks continue to lean towards the downside.
> The shared currency is currently facing challenges in establishing a clear direction as traders remain vigilant. ISM Services PMI and Fed speakers, along with NFP data, are expected to be postponed : Wall Street appears set to conclude the day with gains, even in light of the ongoing stalemate regarding the reopening of the US government. According to data, Gray and Christmas, companies are projected to reduce hiring by more than 30,000 in September, indicating a continued cooling in the labor market. Dallas Federal Reserve President Lorie Logan expressed a hawkish stance, indicating that inflation is currently exceeding the target and showing an upward trend. Despite this, she acknowledged the potential risks associated with both aspects of the dual mandate, noting that the labor market is showing signs of cooling. In light of the current circumstances, it appears that investors are optimistic about a potential rate cut by the Fed during the meeting on October 29, with the probability standing at an impressive 96%. Currently, the US Nonfarm Payrolls report is anticipated to be postponed, resulting in traders awaiting the Institute of Supply Management (ISM) Services PMI for September and updates from Federal Reserve officials. In Europe, Eurostat reported an increase in the Unemployment Rate from 6.2% in July to 6.3% in August, surpassing expectations.
Latest FX Rate Trends : EUR/USD declines following Fed’s Logan’s hawkish remarks, bolstered by Dollar strength
- In September, US employers reported a total of 54,064 job cuts, a decrease from the 85,979 cuts recorded in August, as stated by Challenger. Andy Challenger, Senior Vice President at the firm, stated: “Right now, we’re dealing with a stagnating labor market, cost increases, and a transformative new technology.”
- Job openings in the US indicate a deceleration in the labor market; however, vacancies increased from 7.21 million to 7.23 million in August. Analyzing the data reveals that the hiring rate has decreased to 3.2%, marking the lowest point since June 2024, while layoffs have stayed at a minimal level.
- Reports says that the US Supreme Court has dismissed US President Donald Trump’s directive to remove Federal Reserve Governor Lisa Cook, permitting her to retain her position at least until January, when the court is anticipated to review Trump’s arguments.
- Martins Kazaks, a member of the ECB committee, emphasized that the bank’s interest rates are currently at a “very appropriate level” and should stay the same unless additional shocks arise.