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The dollar is slightly stronger as we move into Non-Farm Friday as manufacturing sentiment  measures failed to encourage investors to take on additional risk yesterday. PMIs from both the UK and Europe and the ISM from the US all disappointed leading equity markets lower and a move to safe haven assets.

The elephant in the room is today’s Non-Farm figure. ADP was worse than expected on Wednesday, Initial Jobless Claims were mixed overnight and Bernanke’s testimony to Congress yesterday has been boiled down to a couple of sound bites including the fact that the unemployment rate in the US may still be above 9% by the end of next year. The median forecast is for a fall of 175k jobs according to Bloomberg with the variance between 260k and 100k. The more negative the figure the better it will be for the USD and if it is worse than last month’s reading of -216k then we could see quite a big fall off for GBPUSD and EURUSD.

GBPEUR has nearly completed its ‘dead cat’ bounce and will probably be lower in a week’s time than where it is at the moment unless services PMI on Monday is significantly better than expected.

Apart from the aforementioned Non-Farms figure we have the accompanying unemployment rate at 13.30. Data from the UK comes in the form of PMI for the construction sector.

Have a good weekend.      

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