All Eyes On US Jobs Report
Settled gas markets and rising equities provided the optimistic investor backdrop that tends to benefit the pound, but sentiment will be challenged by a crucial jobs report from the U.S. later today. Should ‘risk-on’ market conditions extend into Friday’s close the UK currency will claim a rare weekly advance against the dollar and a second successive weekly gain on the euro.
The pound has already hit a new two-month high against the euro on Thursday in the wake of improved sentiment, while against the dollar it was able to build some much needed temporary support.
As trading gets underway this morning, the slightly firmer tone to sterling is reflected in GBP/EUR opening around the 1.1775. Cable (GBP/USD) is operating at the 1.36 threshold whilst the EUR/USD remains close to the halfway mark of the 1.15-1.16 trading band.
Ahead today all eyes will be on the US labour market data for September. The consensus is for a 500k increase in payrolls, which would likely green light a taper announcement from the Fed in November. Unless there is a major downside miss to the payrolls figure, the dollar reaction to the release may be limited.