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Commerzbank’s Carsten Fritsch notes that the Silver price has surged over 10% this week to USD 63.9 per troy ounce, its highest level since late June, pulling the gold/silver ratio back below 70. However, he highlights that solar-sector demand is set to decline for a second year, with Silver’s share in solar modules and total demand expected to fall despite still-elevated prices.

Solar sector drag on silver demand

"Prices for silver, platinum and palladium also rose sharply in the wake of gold. Since the start of the week, the silver price has risen by more than 10% to USD 63.9 per troy ounce, its highest level since late June. As a result, the gold/silver ratio has fallen below 70 again."

"The tailwind for the silver price from the solar industry could be slowing down. BNEF estimates that 19% less silver will be used in the production of solar modules this year than last year."

"This would mark the second consecutive decline. The solar industry’s share of total silver demand is therefore expected to fall to 14%, down from 18% last year. BNEF’s assessment largely aligns with that of the Silver Institute in April, which also anticipates a significant decline in demand from the photovoltaic sector this year."

"BNEF attributes this to a reduction in the use of silver in silicon solar cells, which is expected to fall by a further 17% this year. This was likely triggered by the sharp rise in prices, which reached a record high of USD 120 per troy ounce at the end of January."

"The silver price has since fallen by roughly half, but is still around 65% higher than a year ago. According to BNEF, silver currently accounts for more than 17% of the production costs of a solar module, making it the largest component of material costs."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• USD/JPY falls toward 157.40 after a much weaker-than-expected US employment report.
• US payrolls turn negative in July, while sharp downward revisions to previous months reinforce concerns over a cooling labor market.
• Recent coordinated FX intervention by the US and Japanese authorities remains questioned by markets.

USD/JPY falls toward 157.40 on Friday, down 0.65% on the day at the time of writing, as the US Dollar (USD) comes under heavy selling pressure following a much weaker-than-expected US employment report. The pair is also weighed down by the strength of the Japanese Yen (JPY), as Japanese authorities maintain their commitment to countering excessive weakness in the domestic currency.

Data released by the Bureau of Labor Statistics (BLS) showed that Nonfarm Payrolls (NFP) declined by 23K jobs in July, compared with market expectations for an increase of 80K. Revisions to previous months further darkened the picture, with June payrolls revised down from 57K to 20K and May from 129K to 63K, resulting in a combined downward revision of 103K jobs.

Despite the sharp deterioration in payroll growth, the Unemployment Rate edged down to 4.1% from 4.2%. Meanwhile, the Labor Force Participation Rate slipped to 61.4% from 61.5%, while annual Average Hourly Earnings growth slowed to 3.2% from a revised 3.4%, adding to evidence that the US labor market is gradually cooling.

The US Dollar weakens sharply following the release as investors reduce expectations that the Federal Reserve (Fed) will begin tightening monetary policy in September. According to the CME FedWatch Tool, the chances of a 25-basis-point rate hike at the September meeting fell significantly after the data, with markets now seeing monetary status quo as the more likely outcome.

On the Japanese side, Japan's Ministry of Finance (MoF) confirmed that the United States (US) and Japan jointly intervened in the foreign exchange market to counter excessive volatility in the Japanese currency. Japanese Finance Minister Satsuki Katayama also said on Monday that Japan "won't hesitate to carry out more forex intervention with the US" if necessary.

Japan intervention doubts meet rising BoJ hawkishness

Analysts at BBH highlight that Japan’s Ministry of Finance has now released details of its FX intervention operations for April through June 2026, but stress that “Japan’s intervention record this year is hardly convincing.” They note that the three interventions over that period triggered “kneejerk JPY rallies but little lasting follow-though,” with USD/JPY ultimately pushing on to “a 40-year high around 164.00 on July 23.” BBH adds that the size of Japan’s most recent FX intervention on July 30 and July 31 will only be known at end-August, but current estimates suggest “Japan used a record of about ¥14 trillion to prop up JPY,” driving USD/JPY down from “an intra-day high of 163.74 on July 30 to reach a low of 155.23 on August 3 (8.5 yen rally).”

Even so, BBH observes that “the market narrative is already slipping back into skepticism over the effectiveness of Japan’s intervention,” a view they argue is misplaced. “We think that complacency is premature for two reasons,” they write. First, BBH points to the “coordinated US-Japan intervention – and officials’ warning that they stand ready to act again,” which in their view “significantly raises the cost of fighting a stronger yen and puts a much firmer ceiling on USD/JPY.” They underscore that, “as of the end of July, Japan had $1.09 trillion in currency reserves (¥173 trillion), ample firepower to back up its intervention threat.” Second, BBH believes “risks are skewed towards further hawkish Bank of Japan (BoJ) rate repricing,” noting that “the policy rate (1.00%) is near the lower end of the bank’s neutral range (1.10%-2.50%) while the economy is operating above potential,” which “leaves plenty of room for the BoJ to quicken the pace of normalization.”

TD Securities echoes the sense that monetary policy could become a more important driver for JPY, remarking that “Governor Ueda sounded the most hawkish that he's been in a long while at the July BoJ press conference.” The bank says, “we will parse through the Summary to judge if the Board is also aligned with such a hawkish stance, and is ready to hike faster than its usual semi-annual pace of hikes over the past two years.” However, TD Securities cautions that “we are skeptical that most members are as hawkish and expect the next hike in December,” suggesting that while the policy backdrop is shifting, the pace of BoJ normalization may still fall short of the most aggressive market expectations.

USD/JPY technical analysis

In the one-hour chart, USD/JPY trades at 157.39, maintaining a bearish near-term tone as it holds below the 100-period simple moving average (SMA) at 157.73 and the 200-period SMA at 159.60. The pair has retreated sharply from recent highs, and the Relative Strength Index (14) now sits in oversold territory near 24, hinting that while downside pressure is dominant, selling momentum could be stretched in the short term.

On the topside, initial resistance is located at the 100-period SMA at 157.73, followed higher by the horizontal barrier at 158.57 and then the 200-period SMA at 159.60. On the downside, the next significant support comes at the previously plotted horizontal level near 155.23, where buyers could attempt to slow the decline if the current bearish sequence extends.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

• The British Pound strengthens as weak US payrolls weigh on the US Dollar.
• The US economy unexpectedly loses 23K jobs, reducing bets on a September Fed rate hike.
• Lower Oil prices ease inflation concerns ahead of next week’s US CPI report.

The British Pound (GBP) strengthens against the US Dollar (USD) on Friday after a disappointing US Nonfarm Payrolls report prompts traders to scale back bets on Federal Reserve (Fed) interest-rate hikes. At the time of writing, GBP/USD trades around 1.3506, hovering near three-week highs.

The US economy lost 23K jobs in July, well below market expectations for an increase of 80K. June’s gain was also revised sharply lower to 20K from 57K. However, the Unemployment Rate unexpectedly fell to 4.1% from 4.2%.

The weak payroll figures weigh heavily on the Greenback and US Treasury yields. The US Dollar Index (DXY), which tracks the Dollar against six major currencies, trades around 99.50, down nearly 0.45% on the day. Meanwhile, the benchmark 10-year US Treasury yield falls to around 4.60%, about eight basis points below its intraday high of 4.68%.

According to the CME FedWatch Tool, markets now assign around a 42.1% probability to a rate hike at the September meeting, down from 67% a week ago.

The softer labour-market data comes as energy-driven inflation risks also ease following the recent decline in Oil prices. West Texas Intermediate (WTI) trades around $76 per barrel, down nearly 10% this week.

Oil prices fell sharply after Iran and Oman reportedly moved closer to a framework that could temporarily increase shipping through the Strait of Hormuz, although a final announcement has yet to be made.

Traders now look ahead to next week’s US Consumer Price Index (CPI) data for fresh clues on the inflation outlook. Headline CPI is expected to rise 0.1% MoM in July after falling 0.4% in June, while core CPI is forecast to increase 0.2% following an unchanged reading in the previous month.

• EUR/USD jumps after a much weaker-than-expected US employment report.
• Nonfarm Payrolls show 23K jobs were lost in July, versus expectations for 80K jobs added.
• Sharp downward revisions to the previous two months weaken expectations of Fed policy tightening.

EUR/USD jumps 0.43% on the day and trades around 1.1570 at the time of writing, as the US Dollar (USD) comes under heavy selling pressure following a much weaker-than-expected US employment report.

Data released by the Bureau of Labor Statistics (BLS) on Friday showed that US Nonfarm Payrolls (NFP) declined by 23K in July, compared with market expectations for an increase of 80K jobs. Previous months were also revised sharply lower, with June payrolls revised down from 57K to 20K and May from 129K to 63K, resulting in a combined downward revision of 103K jobs.

Despite the sharp deterioration in payroll growth, the Unemployment Rate edged down to 4.1% from 4.2%, while the Labor Force Participation Rate slipped to 61.4% from 61.5%. Meanwhile, annual Average Hourly Earnings growth slowed to 3.2% from a downwardly revised 3.4% in June, adding to evidence that the US labor market is gradually cooling.

The US Dollar (USD) weakens sharply following the release, as investors reduce bets that the Federal Reserve (Fed) will tighten monetary policy. According to the CME FedWatch Tool, the chance of a 25-basis-point rate hike at the September meeting has fallen to just 44%, down from 55% a day earlier and 67% a week ago. Markets no longer see a September rate hike as the most likely outcome, although they continue to price in a high chance of at least one 25-basis-point rate increase before the end of the year.

In Europe, German economic data provides only limited support to the Euro (EUR). Germany's Industrial Production rose by 0.2% in June, beating expectations of a 0.1% increase but slowing from May's 0.7% gain. Meanwhile, Germany's Trade Balance surplus narrowed to €15.4B, below market expectations.

The European Central Bank (ECB) continues to adopt a cautious stance after leaving interest rates unchanged at its latest meeting. Markets currently expect only one additional rate hike before the end of the year, with a lower chance of a second increase, while investors now turn their attention to the Fed's response following this significant deterioration in US labor market data.

EUR/USD technical analysis

In the one-hour chart, EUR/USD trades at 1.1574, extending its advance above the 100-period simple moving average (SMA) at 1.1530 and the 200-period SMA at 1.1494, which together reinforce a bullish near-term bias. Price also moves above the recent highs and resistance level around 1.1560, while the Relative Strength Index (14) stretches into overbought territory near 80, hinting that the latest upswing may be prone to short-term consolidation rather than a clean continuation.

On the downside, initial support is seen at 1.1560, followed by the 100-period SMA at 1.1530, with deeper demand zones aligned at the trend-line level of 1.1507, the horizontal base at 1.1500 and the 200-period SMA at 1.1494. With no clear resistance levels overhead in the current layout, the pair would likely need a dip toward these supports to ease overbought conditions before fresh buying interest can emerge for another leg higher.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Nordea analysts Kirsti Sunde Midttun and Ole Håkon Eek-Nielsen argue that AI profitability faces structural pressure from high inference costs, rapid model depreciation and growing competition from free and open alternatives. They question the durability of current business models and point to rising investor scepticism toward AI-related equities, alongside a rotation from technology stocks into cyclical, defensive and value-oriented sectors.

Nordea questions AI margin durability

"With the AI buildout now driving a meaningful share of US growth, we examine the sustainability of the underlying business models and whether the recent market scepticism is warranted."

"Despite AI's rapid growth, we see several challenges to profitability and present a more sceptical view of the industry's prospects."

"The net effect is that inference costs remain the central economic challenge for AI developers, and a key reason why the leading model companies are, for now, not profitable."

"Frontier models are, in short, best understood as infrastructure with an unusually short useful life: the value must be extracted before the technology is obsolete."

"Publishing capable models free of charge suppresses willingness to pay across the market and undercuts the business models of developers who charge for access."

"Taken together, the picture is this: frontier models are expensive to build, they depreciate within months, and they face growing competition not just from each other but from free, open alternatives."

"Over the summer, we have also seen some scepticism towards AI-related equities. This has led to a notable rotation out of tech stocks and into cyclical, defensive, and value-oriented sectors."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Nonfarm Payrolls (NFP) in the United States (US) declined by 23K in July, the US Bureau of Labor Statistics (BLS) reported on Friday. This print followed the 20K increase (revised from 57K) recorded in June and fell short of the market expectation for an increase of 80K by a wide margin.

Other details of the report showed that the Unemployment Rate edged lower to 4.1% from 4.2% in June, while the Labor Force Participation Rate retreated to 61.4% from 61.5%. Finally, annual wage inflation, as measured by the change in the Average Hourly Earnings, eased to 3.2% from 3.4%.

"The change in total nonfarm payroll employment for May was revised down by 66,000, from +129,000 to +63,000, and the change for June was revised down by 37,000, from +57,000 to +20,000. With these revisions, employment in May and June combined is 103,000 lower than previously reported," the BLS noted in its press release.

According to the CME FedWatch Tool, the probability of a 25 basis points (bps) Federal Reserve (Fed) interest rate hike dropped to 46% from about 55% before the release of the data.

Market reaction to July Nonfarm Payrolls data

The US Dollar (USD) came under heavy bearish pressure with the immediate reaction. At the time of press, the USD Index was down 0.35% on the day at 99.60.

This section below was published as a preview of the July Nonfarm Payrolls data at 08:30 GMT.

• US Nonfarm Payrolls are expected to rise by 80K in July, rebounding from June’s disappointing 57K increase.
• The Unemployment Rate is forecast to hold steady at 4.2%.
• US employment data could influence the market pricing of a potential Fed interest rate hike in September.

The United States (US) Bureau of Labor Statistics (BLS) is set to release the Nonfarm Payrolls (NFP) data for July on Friday at 12:30 GMT. 

With investors scaling back bets for a Federal Reserve (Fed) interest rate hike in September on easing inflation fears, the underlying details of the employment report could influence how markets assess the US central bank’s policy outlook and drive the US Dollar’s (USD) valuation. 

What to expect from the Nonfarm Payrolls report?

Investors expect NFP to rise by 80K following June’s disappointing print of 57K. The Unemployment Rate is seen holding steady at 4.2%, while the annual wage inflation, as measured by the change in the Average Hourly Earnings (AHE), is projected to remain unchanged at 3.5%.

Economists at Deutsche Bank expect a slightly firmer US labour market print on Friday, projecting that the July payrolls report will show employment growth of “+65k, modestly above June’s +57k reading,” with “private payrolls also expected to rise by +65k after +49k previously.” They forecast the unemployment rate to remain at 4.2%, "although risks are skewed towards a rounding up to 4.3% if labour force participation rebounds after last month’s sharp decline.” On pay and hours, Deutsche Bank looks for “average hourly earnings to increase by +0.3% month-on-month, unchanged from June, while average hours worked are forecast to hold at 34.3 hours.” 

Meanwhile, strategists at BNY Mellon flag this week’s July Nonfarm Payrolls report as a key data point for the Fed, noting that “market expectations currently see around 80,000 new jobs.” They note that they don’t think the payrolls “breakeven rate” needed to keep the unemployment rate from rising “is much above 50,000 per month,” given that “it currently doesn’t require large monthly employment gains to keep the unemployment rate steady, thanks to a much slower labor force growth than before the pandemic.” 

How will the US July Nonfarm Payrolls affect EUR/USD?

Fed policymakers remain focused on taming inflation as the labor market shows no signs of a cooldown despite the disappointing June NFP print. Earlier in the week, Philadelphia Fed President Anna Paulson told CNBC that the Fed will need to act if they fail to make progress on inflation and noted that the job market is stable. Similarly, Kansas City Fed President Jeff Schmid defined the labor market as “roughly balanced” and said that inflation is “too high” and “worrisome.”

After rising more than 20% in July, crude Oil prices turned south in August as investors grew optimistic about the re-opening of the Strait of Hormuz. In turn, the CME Group FedWatch Tool’s probability of a 25 basis points (bps) Fed interest rate hike in September declined to 55% from about 70% at the end of July. A significant downside surprise in the NFP, with a print below 40K, could suggest that the Fed could take its time to ensure that the labor market is not in a downturn before tightening the monetary policy. In this scenario, the USD could come under pressure and allow EUR/USD to gain traction. 

Conversely, an NFP increase of more than 100K could hint that policymakers are likely to continue to prioritize price stability without worrying about a negative impact on employment. In this case, the USD is likely to stay resilient against its rivals and weigh on EUR/USD. However, the pair’s downside could remain limited regardless of the NFP figure if Oil prices continue to decline in the near term.

TD Securities analysts argue that the recent bout of post-Fed Dollar softness does not mark a regime change for the currency. The bank “view[s] the latest USD move more as a temporary retracement rather than the formation of a new USD downtrend,” explaining that “hawkish speeches from the Fed dissenters should offset some of the post-FOMC USD weakness.” In their view, “in the absence of material US data weakness to remove the near-term Fed rate hike pricing, the broad USD Q3 2026 uptrends remain intact.”

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 pair is closing in on key technical levels that could confirm or deny a bullish reversal. The Relative Strength Index (RSI) indicator on the daily chart rose above 60 after failing to clear the neutral 50 level multiple times since early June. While this points to a buildup in bullish momentum, technical buyers could refrain from committing to a steady uptrend until the pair clears 1.1570 and 1.1630 levels, where the 100-day Simple Moving Average (SMA) and the 200-day SMA are located, respectively. If EUR/USD manages to stabilize above the latter level and confirms it as support, 1.1800 could be seen as the next significant resistance level.”

“On the downside, the first support area could be spotted at 1.1475-1.1440 (50-day SMA, 20-day SMA) ahead of 1.1360 (static level) and 1.1280 (static level).”

• The Unemployment Rate in Canada dropped to 6.4% in July.
• USD/CAD remains on the back foot near 1.3950 on Friday.

Statistics Canada reported on Friday that the Unemployment Rate decreased to 6.4% in July, below what markets were expecting.

Additionally, the Net Change in Employment increased by 75.1K jobs, adding to the 18.2K gain we saw in the prior month. In addition, the participation rate ticked a tad higher to 65.1%, and wages are growing at a 3.0% annual pace, down from June’s 3.7% yearly gain.

Market reaction

In the wake of the release, the Canadian Dollar (CAD) regains buying pressure, motivating USD/CAD to break below the psychological 1.4000 threshold for the first time since mid-June.