NEWS / Trade Policy

Dollar choppy ahead of employment data

July 7th - Conflicting data over the last few days regarding employment has left many traders struggling to figure out just how bullish today??™s non-farm payroll data will be later in the session and as a result the dollar has struggled to establish any real direction. There was some heavy selling late in yesterday??™s European session and although some of these gains have since been recovered, overall the market remains lacking in direction. Consensus as to what the employment reading will be has been revised upward of late after this new ADP survey looked particularly robust, followed by a very marginal rise in weekly jobless claims. However, precisely where the tipping point lies to initiate another run of greenback buying remains to be seen but arguably a figure over 200k may be sufficient to cause concern at the Fed that inflationary pressures will continue to prevail. With little else on the economic calendar today it could prove to be a somewhat downbeat start to the European session, especially as the major crosses are looking relatively flat on the week, removing the obvious temptation to start booking profits??¦

Andy Cottrill and Enis Mehmet