EUR/USD: Euro Regains $1.08 amid Broad Dollar Pullback After April’s Soft Jobs Data

Key points:
  • Euro tops $1.08 after US jobs data.
  • Markets ditch dollars for risk assets.
  • Fewer US jobs might mean rate cuts.
Illustration by TradingView

Jobs grew at a pace way below what analysts had expected and that was generally bad news for the US dollar.

  • The EURUSD pair advanced on Friday and was off to a slow but firm start of the new week after the latest US data stirred up forex markets. The Labor Department released its monthly nonfarm payrolls report, showing that America’s employers added 175,000 new hires in April. The figure was way below the consensus of 238,000 and that dented the confidence in the US dollar.
  • The euro-dollar crossed $1.08 after lingering under the $1.07 threshold before the data dump. Traders offloaded their dollars and rushed to scoop up risk assets, such as technology shares and digital currencies. The greenback retreated across the board with the USD/JPY crashing to levels under 153.00. The yen has been on the offensive with about 5% added last week alone as Japan intervened with a roughly $60 billion injection.
  • Fewer jobs created were welcome news for investors left and right. A contracting economy suggests that the Federal Reserve’s rate-cut campaign might be on the table again. Previously, Fed chair Powell pushed back against expectations of rate trims due to incoming streams of hot data. And since the Fed is data-dependent, policymakers might now be reconsidering the rate cuts as a way to support the economy.