Forex News
- March payrolls beat forecasts by a wide margin, boosting the US Dollar.
- Softer services data failed to offset the impact of strong jobs figures.
- Traders trimmed dovish Fed bets as Treasury yields edged higher.
The GBP/USD extended its losses for the second straight day, down 0.12% after a stellar US Nonfarm Payrolls report, which could refocus the Federal Reserve on battling higher inflation that has remained above target for five years. At the time of writing, the pair trades at 1.3205.
Strong payrolls and firmer yields keep Sterling on the back foot
The US Bureau of Labour Statistics (BLS) revealed that the economy created over 178K jobs in March, crushing forecasts of 60K. Despite the positive reading, February’s print was further downwardly revised to -133K, but on a positive note, the Unemployment Rate also fell to 4.3%, down from 4.4%.
In the meantime, the US Dollar Index (DXY), which tracks the American currency's performance versus six peers, is up a minimal 0.12% and back above the 100.00 handle amid growing speculation that the Fed would maintain steady interest rates as the Middle East conflict prolongs.
Recently, the US S&P Global Services PMI contracted in March for the first time since January 23, falling from 51.7 in February to 49.8. Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, wrote: “The PMI survey data show the US economy buckling under the strain of rising prices and intensifying uncertainty, as the war in the Middle East exacerbates existing concerns regarding other policy decisions in recent months, notably with respect to tariffs.”
Williamson commented that the stagflationary environment of no growth and surging prices is a challenge for policymakers, as the S&P survey revealed a slowdown in employment.
Data from the Chicago Board of Trade (CBOT) showed investors trimmed dovish bets and predicted the Fed would hold rates flat for the year. US Treasury yields, particularly the 2-year, edged higher following the NFP release.
GBP/USD price analysis: Technical outlook
In the daily chart, GBP/USD trades at 1.3205. The near-term bias is mildly bearish as spot holds below the clustered Simple Moving Averages (SMAs) surrounding 1.3550, confirming a loss of upside momentum after repeated failures along the descending resistance trendline that started at 1.3869. Price has also slipped away from the prior series of higher supported closes along the rising trendline from 1.3035, shifting the focus toward defending recent lows rather than extending gains. The FXS Fed Sentiment Index continues to grind higher, underscoring a firmer US Dollar backdrop that keeps rallies in GBP/USD vulnerable while the pair trades beneath the broken resistance zone.
Initial resistance emerges at the psychological 1.3300 region, where prior rebounds stalled ahead of the descending trendline, followed by 1.3400 and then the 1.3500 area aligning with the grouped moving averages that cap the upside. On the downside, immediate support is at 1.3200, just below the current price, with a break exposing 1.3100 and then the 1.3035 rising trendline origin. A daily close below this latter band would confirm a deeper bearish extension, while recovery above 1.3400 would ease the immediate downside pressure and open a broader retracement toward 1.3500.
(The technical analysis of this story was written with the help of an AI tool.)
Pound Sterling Price This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.19% | 0.45% | -0.37% | 0.43% | -0.39% | 0.98% | 0.40% | |
| EUR | 0.19% | 0.63% | -0.22% | 0.60% | -0.20% | 1.17% | 0.59% | |
| GBP | -0.45% | -0.63% | -0.80% | -0.02% | -0.83% | 0.54% | -0.07% | |
| JPY | 0.37% | 0.22% | 0.80% | 0.81% | 0.01% | 1.37% | 0.69% | |
| CAD | -0.43% | -0.60% | 0.02% | -0.81% | -0.84% | 0.55% | -0.06% | |
| AUD | 0.39% | 0.20% | 0.83% | -0.01% | 0.84% | 1.38% | 0.75% | |
| NZD | -0.98% | -1.17% | -0.54% | -1.37% | -0.55% | -1.38% | -0.61% | |
| CHF | -0.40% | -0.59% | 0.07% | -0.69% | 0.06% | -0.75% | 0.61% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
- USD/JPY under pressure as intervention fears cap gains despite a firm US Dollar.
- Markets remain cautious near the 160 level amid persistent warnings from Japanese authorities.
- Solid US data support US Dollar and strengthen expectations that Fed could keep rates unchanged for longer.
USD/JPY trades with a mild downside bias on Friday as lingering intervention fears support the Japanese Yen (JPY), even as the US Dollar (USD) remains firm against its major peers following the upside surprise in US Nonfarm Payrolls (NFP) data. Thin liquidity conditions due to the Good Friday holiday are also contributing to muted and choppy price action.
At the time of writing, USD/JPY is trading around 159.57, easing modestly after a brief spike to 159.82 in reaction to the US labor data.
According to data released by the US Bureau of Labor Statistics, the US economy added 178K jobs in March, beating expectations of 60K, while the Unemployment Rate ticked lower to 4.3% from 4.4%. February’s figure was also revised lower to show a loss of 133K jobs, compared to the previously reported decline of 92K, highlighting recent volatility in the labor market.
Average Hourly Earnings rose by 0.2% MoM in March, below the 0.3% forecast and down from 0.4% previously. On an annual basis, Average Hourly Earnings increased by 3.5%, missing expectations of 3.7% and slowing from 3.8%.
The stronger-than-expected headline print supported expectations that the Federal Reserve (Fed) will keep rates unchanged for longer, with markets largely pricing out rate cuts amid Oil-driven inflation risks stemming from the ongoing US-Israel war with Iran.
However, business activity data painted a softer picture, with the S&P Global Composite Purchasing Managers Index (PMI) easing to 50.3 in March from 51.9 in February, marking its weakest level since September 2023. Meanwhile, the Services PMI fell to 49.8, below the flash estimate of 51.1, signaling contraction and the lowest reading in over three years.
The soft PMI print did little to weigh on the US Dollar. The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 100.15, extending gains for the second straight day.
Even so, USD/JPY struggles to draw support. Traders remain wary near the 160 level, as Japanese authorities have repeatedly signaled readiness to act against excessive volatility, keeping gains capped despite underlying US Dollar strength.
Nonfarm Payrolls FAQs
Nonfarm Payrolls (NFP) are part of the US Bureau of Labor Statistics monthly jobs report. The Nonfarm Payrolls component specifically measures the change in the number of people employed in the US during the previous month, excluding the farming industry.
The Nonfarm Payrolls figure can influence the decisions of the Federal Reserve by providing a measure of how successfully the Fed is meeting its mandate of fostering full employment and 2% inflation. A relatively high NFP figure means more people are in employment, earning more money and therefore probably spending more. A relatively low Nonfarm Payrolls’ result, on the either hand, could mean people are struggling to find work. The Fed will typically raise interest rates to combat high inflation triggered by low unemployment, and lower them to stimulate a stagnant labor market.
Nonfarm Payrolls generally have a positive correlation with the US Dollar. This means when payrolls’ figures come out higher-than-expected the USD tends to rally and vice versa when they are lower. NFPs influence the US Dollar by virtue of their impact on inflation, monetary policy expectations and interest rates. A higher NFP usually means the Federal Reserve will be more tight in its monetary policy, supporting the USD.
Nonfarm Payrolls are generally negatively-correlated with the price of Gold. This means a higher-than-expected payrolls’ figure will have a depressing effect on the Gold price and vice versa. Higher NFP generally has a positive effect on the value of the USD, and like most major commodities Gold is priced in US Dollars. If the USD gains in value, therefore, it requires less Dollars to buy an ounce of Gold. Also, higher interest rates (typically helped higher NFPs) also lessen the attractiveness of Gold as an investment compared to staying in cash, where the money will at least earn interest.
Nonfarm Payrolls is only one component within a bigger jobs report and it can be overshadowed by the other components. At times, when NFP come out higher-than-forecast, but the Average Weekly Earnings is lower than expected, the market has ignored the potentially inflationary effect of the headline result and interpreted the fall in earnings as deflationary. The Participation Rate and the Average Weekly Hours components can also influence the market reaction, but only in seldom events like the “Great Resignation” or the Global Financial Crisis.
The US S&P Global Services PMI in March reported that business activity in the sector is slowing sharply, falling to contractionary territory for the first time since January 2023, amid higher inflation and the war in the Middle East.
The index fell from 51.7 in February to 49.8, according to S&P. They noted that, “Overall, it was the lowest index reading for over three years and consistent with a fractional contraction in activity.”
Rising input prices due to the surge in energy costs are one of the reasons that are weighing on the services sector, as the report read, “the latest price data signaled the continuation of above trend input cost inflation, with prices overall rising to the greatest degree so far in 2026.”
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, wrote, “The service sector has slipped into contraction for the first time since January 2023, dragging the overall economy down to a near-stalled 0.5% annualized rate of growth in March. Worst hit is consumer-facing service sectors where, barring the pandemic lockdowns, the downturn reported in March was among the steepest recorded since data were first available in 2009.”
He added that the “Key to the deteriorating growth trend is a pull-back in spending amid worsening affordability, with costs and selling prices surging higher in March amid spiking energy prices.”
Market reaction to Nonfarm Payrolls data
The US Dollar (USD) remains steady after its modest rise following the Nonfarm Payrolls report, with the US Dollar Index (DXY) trading with modest gains above 100.00.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.10% | 0.09% | -0.03% | 0.18% | 0.08% | 0.33% | 0.07% | |
| EUR | -0.10% | 0.03% | -0.11% | 0.08% | 0.09% | 0.21% | -0.03% | |
| GBP | -0.09% | -0.03% | -0.13% | 0.06% | 0.08% | 0.19% | -0.06% | |
| JPY | 0.03% | 0.11% | 0.13% | 0.21% | 0.21% | 0.33% | 0.07% | |
| CAD | -0.18% | -0.08% | -0.06% | -0.21% | 0.02% | 0.14% | -0.12% | |
| AUD | -0.08% | -0.09% | -0.08% | -0.21% | -0.02% | 0.11% | -0.14% | |
| NZD | -0.33% | -0.21% | -0.19% | -0.33% | -0.14% | -0.11% | -0.26% | |
| CHF | -0.07% | 0.03% | 0.06% | -0.07% | 0.12% | 0.14% | 0.26% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
- AUD/USD pares gains as strong US jobs data supports the US Dollar.
- Holiday-thinned liquidity keeps price action muted despite NFP upside surprise.
- Strong US jobs data gives the Fed room to keep interest rates unchanged for longer.
AUD/USD reverses earlier gains on Friday as stronger-than-expected US Nonfarm Payrolls (NFP) data supports the US Dollar (USD), adding modest pressure on the Australian Dollar (AUD), while price action remains subdued amid thin liquidity due to the Good Friday holiday.
At the time of writing, AUD/USD is trading around 0.6900, after touching an intraday high of 0.6916. Meanwhile, the US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is consolidating gains above the 100 mark.
According to data released by the US Bureau of Labor Statistics, the US economy added 178K jobs in March, comfortably exceeding expectations of 60K. Notably, February’s figure was revised lower to show a loss of 133K jobs, compared to the previously reported decline of 92K. The Unemployment Rate ticked lower to 4.3% from 4.4%.
Despite the strong headline print, softer wage growth offered a more balanced picture. Average Hourly Earnings rose by 0.2% MoM in March, below the 0.3% forecast and easing from 0.4% previously. On an annual basis, earnings increased by 3.5%, missing expectations of 3.7% and slowing from 3.8%.
The data reinforced expectations that the Federal Reserve (Fed) will remain patient before delivering any rate cuts, as ongoing Oil-driven inflation risks continue to cloud the policy outlook. This has prompted traders to scale back rate cut expectations and increasingly price in a prolonged hold, with markets now expecting rates to remain unchanged through 2026, according to the CME FedWatch Tool.
Elsewhere, traders also digested the latest data from the National Bureau of Statistics of China, released earlier on Friday, which showed the Manufacturing Purchasing Managers Index (PMI) rising to 50.4 in March, up from 49 previously and above expectations of 50.1. Australia’s economy is closely tied to China, its largest trading partner, making the Australian Dollar sensitive to shifts in Chinese economic activity.
Australian Dollar FAQs
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
- March payrolls smashed forecasts, reinforcing the US economy’s resilience.
- Falling Unemployment boosted speculation the Fed may stay on hold.
- BoC rate hike expectations and thin holiday trade capped gains.
The USD/CAD rises some 0.14% on Friday after an outstanding employment report in the US, which nearly tripled economists' projections, according to the US Bureau of Labor Statistics (BLS). At the time of writing, the pair trades at 1.3936 on thin liquidity trading as most global markets remain shut due to Good Friday.
Strong payrolls revive Fed hold bets as BoC tightening eyed
Nonfarm Payrolls in March rose by 178,000, exceeding forecasts of 60,000, up from February’s downwardly revised figures of -133,000. The Unemployment Rate fell two ticks to 4.3%, below the Federal Reserve’s 4.5% long-run target, which means the central bank's priority has returned to inflation.
The US Dollar Index (DXY), which measures the buck’s value against six currencies, is up a minimal 0.06% and back above the 100.00 handle amid growing speculation that the Fed would not cut rates, as indicated by money markets.
Data by the Chicago Board of Trade (CBOT) revealed that investors trimmed dovish bets and predicted the Fed would hold rates throughout the year.
Across the northern border, the Bank of Canada held rates steady on March 18, and Governor Tiff Macklem commented that policymakers would look through the immediate inflationary impact of the Iran conflict but would act if price pressure proved persistent.
The swaps market had priced in two BoC rate hikes for the second half of the year.
USD/CAD price analysis: Technical outlook
The immediate reaction to the NFP saw the USD/CAD rise past the April 2 high of 1.3933, which could open the door to a challenge of 1.3950, with the next area of interest at 1.4000. On the downside, the 1.3900 figure would be the floor, amid low volumes on Friday.
Canadian Dollar FAQs
The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.
The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.
The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.
While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar.
Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
- EUR/USD trades on the back foot as the US Dollar holds firm after strong US NFP data.
- Thin liquidity due to the Good Friday holiday keeps price action muted.
- Solid US jobs data reinforces the view that Fed will keep rates unchanged for longer.
EUR/USD trades in a tight range on Friday as a stronger-than-expected US Nonfarm Payrolls (NFP) report lends support to the US Dollar (USD), while the Euro (EUR) holds relatively steady amid thin liquidity conditions due to the Good Friday holiday.
At the time of writing, the pair trades around 1.1534, remaining on the back foot for the second straight day after rising to a one-week high of 1.1627 on Wednesday. Meanwhile, the US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is hovering near the 100 mark.
According to data released by the US Bureau of Labor Statistics, the US economy added 178K jobs in March, beating expectations of 60K. February’s figure was also revised lower to show a loss of 133K jobs, deeper than the previously reported decline of 92K. At the same time, the Unemployment Rate edged lower to 4.3% from 4.4%.
However, wage growth showed signs of moderation. Average Hourly Earnings rose by 0.2% MoM in March, below the 0.3% forecast and easing from 0.4% previously. On an annual basis, earnings increased by 3.5%, missing expectations of 3.7% and slowing from 3.8%.
The data showed labor market conditions remain resilient overall, despite choppy trends in recent months, and reinforced expectations that the Federal Reserve (Fed) has room to keep interest rates unchanged for longer.
Markets have largely priced out rate cut bets since the US–Israel war with Iran erupted, as Oil-driven inflation risks intensified, and the latest labor data reinforces that view.
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
United States President Donald Trump is on the wires on Good Friday, claiming on Truth Social that the US can easily reopen the Strait of Hormuz, take the oil, and make a fortune.
With a little more time, we can easily OPEN THE HORMUZ STRAIT, TAKE THE OIL, & MAKE A FORTUNE. IT WOULD BE A “GUSHER” FOR THE WORLD??? President DONALD J. TRUMP"
Market reaction to the news
The US Dollar trades marginally higher on the day, helped by an upbeat March Nonfarm Payrolls report, although thinned market conditions due to Easter Holidays keep it within familiar levels.
Employment FAQs
Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.
The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.
Nonfarm Payrolls (NFP) in the United States (US) increased by 178K in March, according to data released by the US Bureau of Labor Statistics (BLS) on Friday. The figure marks a marked reversal from February’s 133K drop (revised from -92K) and came in well above market expectations for a 60K gain.
Elsewhere in the report, the Unemployment Rate ticked lower to 4.3% (from 4.4%), while the Labor Force Participation Rate edged marginally lower to 61.9% from 62%. At the same time, wage pressures showed a slight downtick, with annual growth in Average Hourly Earnings easing to 3.5% (from 3.8%).
" The change in total nonfarm payroll employment for January was revised up by 34,000, from +126,000 to +160,000, and the change for February was revised down by 41,000, from -92,000 to -133,000. With these revisions, employment in January and February combined is 7,000 lower than previously reported”, the BLS noted in its press release.
Market reaction to Nonfarm Payrolls data
The US Dollar (USD) keeps its vacillating tone unchanged in the wake of the release, with the US Dollar Index (DXY) trading with modest gains past the psychological 100.00 threshold.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.09% | 0.07% | 0.02% | 0.15% | 0.02% | 0.24% | 0.10% | |
| EUR | -0.09% | 0.02% | -0.07% | 0.06% | 0.04% | 0.14% | 0.00% | |
| GBP | -0.07% | -0.02% | -0.08% | 0.05% | 0.04% | 0.13% | -0.00% | |
| JPY | -0.02% | 0.07% | 0.08% | 0.13% | 0.11% | 0.20% | 0.06% | |
| CAD | -0.15% | -0.06% | -0.05% | -0.13% | -0.01% | 0.09% | -0.04% | |
| AUD | -0.02% | -0.04% | -0.04% | -0.11% | 0.00% | 0.08% | -0.05% | |
| NZD | -0.24% | -0.14% | -0.13% | -0.20% | -0.09% | -0.08% | -0.14% | |
| CHF | -0.10% | -0.01% | 0.00% | -0.06% | 0.04% | 0.05% | 0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
This section below was published as a preview of the March Nonfarm Payrolls data at 04:00 GMT.
- Nonfarm Payrolls are expected to rise by 60K in March.
- The Unemployment Rate is seen holding steady at 4.4%.
- Markets could have a delayed reaction to employment data due to the Good Friday holiday.
The United States (US) Bureau of Labor Statistics (BLS) will release the Nonfarm Payrolls (NFP) data for March on Friday at 12:30 GMT.
Investors will scrutinize the underlying details of the employment report to assess whether the Federal Reserve (Fed) is likely to consider an interest-rate hike later in the year. Still, the immediate market reaction could remain subdued, with trading volumes staying thin on the Good Friday holiday.
What to expect from the next Nonfarm Payrolls report?
Investors expect NFP to rise by 60K following the disappointing 92K decrease recorded in February. The Unemployment Rate is expected to remain unchanged at 4.4%, while the annual wage inflation, as measured by the change in the Average Hourly Earnings, is projected to decrease to 3.7% from 3.8% in the previous month.
Previewing the employment report, TD Securities analysts note that they expect a moderate 30K increase in NFP in March.
“The reversal of weather and strike effects should result in a payrolls composition similar to the end of 2025, with outsized healthcare support. We also look for the Unemployment Rate to remain at 4.4%, with a risk of moving higher. Average Hourly Earnings likely increased a subdued 0.2% m/m, translating to 3.6% y/y,” they add.
Automatic Data Processing (ADP) reported earlier in the week that employment in the private sector rose by 62K in March. This print followed the 66K (revised from 63K) increase reported in February. Assessing the report’s findings, “overall hiring is steady, but job growth continues to favor certain industries, including health care,” said Dr. Nela Richardson, chief economist at ADP. Meanwhile, the Employment Index of the Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers’ Index (PMI) survey came in at 48.7 in March, pointing to an ongoing contraction in the manufacturing sector payrolls.
Danske Bank Research Team also projects the NFP to come in at 30K and see the Unemployment Rate rising to 4.5%. “Recent indicators, including declines in daily job postings and weekly private sector employment growth, point to a softer labour market,” they note.
Employment FAQs
Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.
The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.
How will the US March Nonfarm Payrolls affect EUR/USD?
The USD outperformed its rivals in March as it benefited from the risk-averse market atmosphere and growing expectations for a hawkish tilt in the Federal Reserve’s (Fed) policy outlook, with surging crude Oil prices reviving fears over inflation getting out of control. The US Dollar Index (DXY) gained more than 2% in March and experienced heightened volatility in the first days of April.
While speaking at an event organized by Harvard University earlier this week, Fed Chair Jerome Powell noted that there is tension between the Fed’s two mandates, keeping maximum employment and stable prices, and said that they are in a good place to wait and see how the current situation plays out. Commenting on labor market conditions, Powell said that job creation is very low and that it's challenging to enter the job market.
Meanwhile, NY Fed President John Williams acknowledged that the job market is sending signals, adding that the low hiring rate might be feeding into economic pessimism.
According to the CME FedWatch Tool, markets are currently pricing in about an 80% probability that the Fed policy rate will remain unchanged at the range of 3.5%-3.75% by the end of 2026. In early March, markets were projecting a 92% chance that the Fed would cut the policy rate at least once this year.
A positive surprise in the NFP, with a reading of at least 70K, could cause markets to reassess the possibility of a Fed rate hike and boost the USD. Conversely, a print below 50K, especially if combined with an uptick in the Unemployment Rate, could make it difficult for the USD to outperform its rivals and help EUR/USD hold its ground. Nonetheless, unless a de-escalation of the Middle East conflict leads to a steady decline in Oil prices, a steady uptrend in EUR/USD could be difficult to come by, even if the NFP misses analysts’ estimates.
Eren Sengezer, European Session Lead Analyst at FXStreet, offers a brief technical outlook for EUR/USD:
“EUR/USD’s near-term technical outlook suggests that the bearish bias remains intact despite the latest recovery attempt. The pair remains below a descending trend line drawn from late-January and the Relative Strength Index (RSI) indicator on the daily chart retreats toward 40 after failing to clear the 50 midline earlier in the week.”
“On the downside, 1.1430-1.1400 (lower limit of the Bollinger Band, static level) aligns as a key support before 1.1300 (round level) and 1.1220 (static level). Looking north, immediate resistance could be spotted at 1.1600 (round level, descending trend line) ahead of the 1.1680-1.1700 region, where the 100-day Simple Moving Average (SMA) and the 200-day SMA align.”
(This story was updated on April 3 at 07:10 GMT to reflect a consensus change in the annual Average Hourly Earnings to 3.7%)
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
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