EUR/USD: Dollar Strengthens Against Euro After Dismal October Jobs Data

Euro slides against US dollar after the US economy churns out the lowest jobs tally since December 2020.

• The EURUSD pair drifted lower in the US trading session Friday after the monthly nonfarm payrolls report showed hiring slowed sharply to 12,000 jobs added in October, far below expectations of 112,000. The euro depreciated by 0.8% to levels near $1.0820, down from a session high of $1.0906. The greenback has renewed its strength now that markets are pricing in an uglier-than-expected jobs data, suggesting the US economy lagged in the final month before the US election.
• The sudden rise in the dollar snaps a four-day winning streak for the euro-dollar pair and brings back the buck’s dominance across the board. The Japanese yen slipped beyond ¥153. Such a low hiring figure should ideally solidify prospects of more interest rate cuts by the Federal Reserve, which aim to alleviate the strain over the economy by making borrowing more affordable.
• What happened to the US economy to go there? Hurricanes, strikes, and storms, mostly. US employers pulled back from filling in new roles amid two major hurricanes, storms and labor strikes, including a Boeing strike. It was the lowest net gain since 243,000 jobs were lost in December 2020 when the worst Covid wave hit the economy. In contrast, September’s jobs data was revised to 223,000 from 254,000.