US data hits the USD
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Daily Currency Update
In November, U.S. payrolls surged by 227,000, exceeding the expected 214,000 and rebounding sharply from an upwardly revised 36,000 in October. This improvement followed the easing of disruptions caused by labour strikes and severe storms in the Southeast. However, the unemployment rate rose to 4.2%, higher than forecast, increasing speculation about a potential Federal Reserve interest rate cut later this month.GBP/USD briefly broke above 1.2800 after the U.S. payroll data on Friday but dropped to 1.2720 overnight. It has since begun climbing as the European session opens. GBP/EUR remains above 1.2050 and is testing resistance at 1.2100, a key level proving hard to break. EUR/USD spiked above 1.0600 on Friday but opened Monday at 1.0570.
Key Movers
Despite Monday being a quiet day for heavyweight macroeconomic data, significant interest rate decisions are anticipated this week from Australia, Canada, Switzerland, and the European Union. The EU’s decision, expected on Thursday, includes a likely 25 basis point cut. Midweek attention turns to the latest inflation figures from the U.S., with CPI data (month-on-month and year-on-year) set for release on Wednesday.On Friday, the UK will publish month-on-month GDP figures, with November’s expected -0.1% contraction forecast to improve to 0.1% in December. This release will close the week, setting the stage for upcoming U.S. and UK interest rate decisions the following week. As we move closer to the holiday period, currency markets are likely to remain volatile.
Expected Ranges
- GBP/USD: 1.2720 - 1.2840 ▲
- GBP/EUR: 1.2040 - 1.2120 ▲
- GBP/AUD: 1.9720 - 1.9990 ▲
- EUR/USD: 1.0530 - 1.0620 ▲