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FX snapshot

The pound has held on to the $1.68 mark ahead of the US jobs report, while the euro has declined against the dollar in overnight trading but it is still well above the $1.36 mark.

Pound coin and dollar note
Source: Bloomberg

Sterling holds $1.68

The pound edged higher yesterday when eyes were on the European Central Bank and has managed to retain its gains, after UK consumer inflation expectations came in at 2.6%. Though the gains were minimal, it bodes well for the pound that it is above the important $1.68 level ahead of non-farm payrolls and the announcement of unemployment levels at 1.30pm (London time). The consensus is for an increase of 215,000 and unemployment to rise to 6.4%, but we should keep in mind the recent ADP and jobless claims reports missed expectations.

If jobs data misses expectations we could see the pound head towards $1.6880, while a solid jobs figure could push the pound to $1.6720.

Spot FX GBP/USD chart

Euro recoups losses

The euro is trading at $1.3627, down 0.2% as traders secure their profits from the surge in the currency in the wake of the ECB rate cut yesterday. We are not expecting any economic updates from the eurozone today; traders are instead eyeing up the non-farm payrolls and unemployment report. If the figures miss expectations the euro could retake $1.3660; however, the risk is bigger to the downside. We could move towards $1.35 if reports beat the already lowered expectations.

Spot FX EUR/USD chart

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