EUR/USD Pauses Weekly Gains on Friday Holiday and US Jobs DATA

On Good Friday, the EUR/USD pair took a pause after a three-week uptrend, but it still posted its third consecutive weekly gain due to the European Central Bank's relatively more hawkish bias. The pair is currently hovering around 1.0920 as Euro bulls await the US Nonfarm Payrolls, which will be released on Friday. The holiday has also limited the pair's reaction to data.

The latest data from Germany and the Eurozone kept the European Central Bank hawks on the table, unlike their US counterparts. Germany's Industrial Production (IP) rose by 0.6% YoY in February, beating market forecasts of -2.7% and the previous reading of -1.6%. Additionally, the monthly figures were also better than expected, with a growth of 2.0% versus 0.1% forecasted and 3.7% in the previous reading. Germany Factory Orders improved to -5.7% YoY for February, compared to -12.0% revised down prior and -10.5% market forecasts, while the MoM growth came in at 4.8% versus 0.3% expected and 0.5% previous readings. However, Eurozone S&P Global Composite PMI and Services PMI declined to 53.7 and 55.0 in March, respectively.

In contrast, US economic health remains a concern as the Federal Reserve's preferred gauge cited recession woes. The recent research from the Fed argued that the "near-term forward spread" comparing the forward rate on Treasury bills 18 months from now with the current yield on a three-month Treasury bill was the most reliable bond market signal of an imminent economic contraction.

The European Central Bank policymakers' hawkish tone is favorable for the Euro buyers, but the downbeat US employment clues and the IMF's Managing Director Kristalina Georgieva's prepared remarks about the global economy growing by less than 3% in 2023, down from 3.4% in 2022, put a floor under the EUR/USD prices.

All eyes are on the US employment numbers, which are expected to have a softer print of the headline Nonfarm Payrolls (NFP) to 240K from 311K prior, with no change in the Unemployment Rate of 3.6%. The mixed expectations for the Average Hourly Earnings make the outcome even more interesting.