The US dollar continued its descent following the release of the latest Non-Farm Payrolls (NFP) report, despite the headline number surpassing market expectations. However, the significant downward revision of January’s data more than offset the positive February figures.
In February, 275,000 new jobs were added, outpacing the market estimate of 200,000. Meanwhile, the previously reported 353,000 jobs added in January were revised down to 229,000, a substantial difference of 124,000. Additionally, the unemployment rate rose to 3.9% from the previous 3.7%, while average hourly earnings decreased to 0.1% compared to the expected 0.3%.
Aside from the headline NFP figure, this month’s report reveals a weaker-than-expected US labor market, reinforcing market predictions of a 25-basis-point interest rate cut at the Federal Open Market Committee (FOMC) meeting on June 12.
Economic Calendar and Market Impact
To stay up-to-date with economic data releases and market events, consult the DailyFX Economic Calendar.
The US dollar slipped further after the report and is now hovering around the 61.8% Fibonacci retracement level near 102.50. The 102.00 level, marked by a cluster of previous highs and lows, could provide support and slow a further downward movement. If the decline persists, attention may turn to the 71.8% Fib retracement at 101.17 and the multi-month low of December 28 at 100.74.
US Dollar Index Daily Chart
Charts via TradingView
What is your outlook on the US Dollar and Gold?
Let us know your thoughts using the form at the end of this piece or by contacting the author on Twitter @nickcawley1.