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NFP provides Goldilocks foundation for........>

FOREX: NFP provides Goldilocks foundation for risk-on trade
-Friday's Nonfarm payrolls hit the highest level in 18 months, beating
expectations by 50%. As is often the case, markets didn't know which way to turn
upon release but the combination of a strong jobs gain headline and a better
participation rate with the lower-than-expected wage gains numbers suggested
this labor market may still be far from full employment. As a result, markets
bought up riskier currencies, emerging markets, commodities and equities, to the
detriment of haven currencies and treasury bonds.
-The better NFP number twinned with firmer oil prices lifted NOK to the top spot
in G10 FX, with AUD and CAD following close behind. CAD got a further
shot-in-the-arm from Canada's jobs report, which saw the unemployment rate
unexpectedly drop.
-JPY is the poorest performer, allowing USD/JPY to climb to Y107 just after NY
cut, at which over $4bln of options rolled off.
-Focus next week turns to US inflation numbers and retail sales, speeches from
ECB's Draghi and BoC's Poloz as well as an ECOFIN meeting in Brussels.
MNI London Bureau | +44 203-865-3809 |
MNI London Bureau | +44 203-865-3809 |

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