Renew optimism over the US tax reform pushing the dollar index higher against its major peers. Ahead of today’s September NFP the DXY trading on a verge of a break. Parallel resistance seems at 94.15 above this 94.60 exists it’s 100DMA.

Also read: FX overview

 Data review:

  • US Manufacturing PMI registered 53.1 in September, up slightly on the flash reading of 53.0 and rising from 52.8 in August.
  • September NMI registered 59.8 percent, 4.5 percentage points higher than the 55.3 percent registered in August
  • US Private Sector Employment Increased by 135,000 Jobs in September
  • In the week ending September 30, the advance figure for seasonally adjusted initial claims was 260,000, a decrease of 12,000 from the previous week’s unrevised level of 272,000
  • The goods and services deficit was $42.4 billion in August, down $1.2 billion from $43.6 billion in July, revised. August exports were $195.3 billion, $0.8 billion more than July exports. August imports were $237.7 billion, $0.4 billion less than July imports.

 What’s on today?

September non-farm payrolls

Recent hurricanes Irma and Harvey are likely to impact the payroll data. We believe the impact is limited as US job market near to full employment. The recent catastrophic event will not undercut the Fed’s comfort.

The following are the banks’ forecast summary on September non-farm payrolls:

 HSBC: Hurricane is expected to be the ultimate impact of non-farm in September will be less, in September non-farm employment figures for the 105,000 people.

Dansk Bank: As the September non-farm is unlikely to affect the monetary policy, it is expected that there will be no drastic changes in the market reaction.

September is expected to increase the number of non-agricultural employment 90,000 people.

The negative impact on the job market should be temporary, as we have seen the beginning of the week when the number starts to decline.

Holland International Group: Strong payroll data is more worthy of attention than hurricane-affected employment data. Expected in September the unemployment rate will stabilize at 4.4%.

Wells Fargo: It is expected that the number of new non-farm jobs in September will be 5.5 million.

Barclays: We look for nonfarm payrolls to expand by 75k, down from 156k in August. We look for private payrolls to rise by 70k. We also expect average hourly earnings to rise by 0.3% m/m and 2.6% y/y, while average weekly hours remain unchanged at 34.4. With the slowdown in employment growth on the month, we expect an unchanged unemployment rate at 4.4%.

Nomura: We expect nonfarm payroll employment to increase 50k, with a 45k increase in private payroll and 5k from the government. We expect average hourly earnings to increase by a strong 0.4% m-o-m in September, bringing the y-o-y rate to 2.61%.

Goldman Sachs: The non-farm only recorded an increase of 50,000 people (Note: Reuters is expected to increase 90,000). Three-month non-farm average increase of 185,000; Recorded a rate of 4.5 per cent and an average hourly rate of 0.4 per cent on annual basis, with an annual rate of 2.7 per cent.


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