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FOREX: EUR Recovers Off Lows, While Trend in USD/JPY Remains Lower

FOREX
  • Despite softer stocks, lower US yields and a general risk-off theme, currency markets are more sanguine early Friday, treading water ahead of the key US jobs release later today. The single currency is among the strongest performers in G10, recovering off lows posted yesterday at 1.0778 to keep EUR/USD above the 1.08 handle ahead of the NY crossover.
  • JPY benefits from the cautious backdrop, however USD/JPY is yet to print a new pullback low - still intact from yesterday at 148.51. Clearance here puts the pair to fresh multi-month lows. 
  • Elsewhere, equities markets are backtracking, with the e-mini S&P and broader US equity futures space pointing to a deeply negative open on Wal Street later today. Intel's after-market earnings on Thursday were the core trigger, with a very disappointing set of results driving their share price lower by over 20% ahead of the opening bell. As a result, global chipmakers and tech names are heavy, prompting notable underperformance in the NASDAQ future and Dutch stock indices - home to semiconductor name ASML.  
  • Currency markets are on watch for today's NFP print (currently expected at +175k, with a whisper number of +170k), with renewed concerns on the pace of the deterioration in the US labour market. The unemployment rate is of interest, and any further tick higher in the rate this month will put the rate at a new post-pandemic high. 

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