• NFP takes the wind out of the USD
  • Fed member Evans gives his two cents
  • Bank of Japan gives in to market moves
  • Central banks in focus next week

Even as the dollar inched higher overnight, jobs day did not deliver the numbers investors wanted. Even as US businesses added more jobs than expected, the overall report was not good for the greenback. Wages were below expectations, unemployment ticked up, and revisions to the November and December reports cut a total of 39,000 jobs from prior estimates.

The dollar fell immediately following the report and is set for the fourth weekly drop after a historically poor start to the year. Chicago Fed President Charles Evans spoke immediately following the employment report and was far more upbeat, saying that the report was “very good”, echoing the view of other Fed members who have said they expect wages to pick up as the economy nears full employment.

The yen had a busy overnight session revolving around the Bank of Japan. The central bank announced plans to purchase around four billion dollars’ worth of bonds with five- to ten-year maturities, but the announcement failed to meet investor’s expectations, sending the yen lower and yields higher. The BOJ took stock of the market’s reaction and just hours later they offered to buy an unlimited number of bonds – whatever it takes to get yields to the bank’s target. While the USD firmed after the second announcement, disappointing employment data sent the greenback lower against the yen for the second time today.

Next week is fairly light for US data, but investors will be keeping an eye on the numerous Fed members scheduled next week. Also keep an eye on the Q&A with ECB president Mario Draghi Monday, The Reserve Bank of Australia’s rate decision on Tuesday, and President Trump’s meeting with Japanese PM Shinzo Abe Friday.

EURUSD: Euro is higher after overnight dips were erased by dollar weakness.

GBPUSD: The pound is weaker as we look for more Brexit focus next week.

AUDUSD: Aussie dollar is up after US jobs report shows weaker than expected wages.

USDJPY: After a bumpy ride overnight, the yen is stronger once again.

USDCAD: CAD is stronger as we also see the pain from a disappointing US jobs report.