US Non-Farm Payrolls missed expectations by a wide mark, increasing fears of an economic downturn in the USA, but driving up expectations of a rate cut by the Fed. Markets had already priced in a rate cut by the Federal Reserve, but the weakness in the labour market all but ensures this will happen. This coming week will look closely at inflation, both sides of the Atlantic, but otherwise it will be a slow week in terms of global economic data releases. The US Dollar retreated, with the EUR rising above 1.1700, while the GBP rebounded to 1.3500.
The weaker reserve allowed commodity currencies to regain some mojo, with the AUD reclaiming 0.6550, while the NZD headed back towards 0.5900. A slow economic data week will open the door to market speculations over the Fed and Geo-Political issues.
