EUR/USD: Euro Pulls Back as Dollar Bulls Step Up Bets Ahead of December’s Jobs Report

Nonfarm payrolls for December are expected to land at a soft 170,000 new hires. Any major deviation could rattle the Federal Reserve’s rates projection.

• The EURUSD pair slipped modestly to the downside early Friday as forex speculators rotated into the US dollar ahead of today’s key data. It’s Jobs Day again and, as usual, markets are anticipating another promising number from the US economy.
• This time, analysts have pinned 170,000 as the expected pace of hiring for December. A number too high above that will indicate that the American labor force is not cooling as intended. What’s more, it could sway the Federal Reserve into reconsidering its stance on the upcoming interest rate cuts this year.
• In that light, the EURUSD was trading near the $1.09 to $1.0920 neighborhood. The US dollar has started the year on an upbeat note denting the euro’s valuation by about 120 pips. Over the past year, the euro was able to chip away at the dollar’s value by about 3% after lots of strenuous effort.