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Jobs report drives gains

USD - United States Dollar

The US dollar strengthened in value against most major currencies this morning after a positive jobs report was released.

Since yesterday, the dollar gained over half a percent against the euro, nearly three-quarters of a percent against the pound and 0.65% against the Canadian dollar.

According to the US Bureau of Labor Statistics, Non-Farm Payrolls increased by 1.8 million in July and the unemployment rate fell to 10.2 percent. Both points beat forecasted expectations, which is good for the local currency.

The positive jobs report sends mixed messages to US congressional leaders. Today marked the deadline to agree on a fiscal stimulus package. After the European Union passed package two weeks ago, the strength of the euro increased. Many expect the dollar to rebound from its doldrums with a US fiscal package.

Key Movers

Yesterday the Bank of England kept rates unchanged at 0.1 percent and its asset purchase program at £745 billion. Looking at these two figures surely this is dovish news for the pound, however diving down deeper into the Bank of England statement they are in fact more optimistic about the UK economy than many other forecasters and indeed their own projections from May. According to the central bank the UK is expected to shrink by 9.5% this year before bouncing back 9% next year. All in all, this improved outlook put the wind in the sails for the pound although it didn't quite break those March 2020 highs.

Expected Ranges

USD/CAD: 1.327 - 1.339 ▲

GBP/USD: 1.301 - 1.316 ▲

EUR/USD: 1.175 - 1.189 ▲