After mentioning about a surprise drop in the US unemployment rate, and seeing strong nonfarm payroll (NFP) figures, you would expect that high-yielding currencies would be pushed to new highs. If so, why didn’t we see a huge rally yet? Here are reasons.
First, let us see what we can get from the Current Employment Statistics. It represents the NFP headline figure for November at 120,000, which is a reflection of the 20,000 slip in public sector and the 140,000 increase in private sector. What does it mean? Some economists’ explain that the rise in the private sector is related to temporary jobs in the retail industry. Not only that, the increase in private sector jobs is still below this year’s average monthly rise at 156,000. We surely can’t forget that the unemployment rate sharply dropped to the lowest 8.6% since March 2009.
Furthermore, more than a few Forex traders are considered to take profits prior to the release of potential market-moving economy financial reports . The traders not only get hold of the latest interest rate decisions from the ECB, but also have closer watch to other major reports. The Forex investors expect central banks from commodity-producing nations to remain their rates stable. Meanwhile, the ECB is expected to cut its rate to enhance economic growth.
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