Weak labour data pressures GBP as USD awaits Non Farm Payroll

Key Movers

Attention now turns to the US, where the key event later today is the November Non-Farm Payrolls report. Markets are positioned for a relatively soft reading, which would align with the Federal Reserve’s recent easing cycle. The US Dollar is trading with a softer bias ahead of the release. A weaker-than-expected print could trigger further USD selling, while any upside surprise may prompt a sharp, short-term rebound in the Dollar.

The Euro remains well supported, extending gains against Sterling and holding near recent highs against the US Dollar. The currency continues to benefit from a comparatively stable ECB policy outlook, with rates expected to remain unchanged this week, in contrast to the more dovish stance priced in for the Bank of England.

Eurozone flash PMIs are due this morning, including manufacturing and services indices for Germany, France, and the broader euro area. These provide early insight into December economic activity and will be closely watched for signs of growth momentum or slowing.

The German ZEW Economic Sentiment Index for December is also scheduled, offering a survey-based measure of investor expectations for economic prospects across the euro area.

A Eurozone Trade Balance figure is due later, which can provide additional context on external demand trends.