Despite the official jobs data from the US is due to be released on Friday,
viscous rumour circulated in the markets yesterday leading to a massive dollar
sell off. The result; a 3 month low for the dollar against the pound and the
euro and the largest fall against the Japanese Yen in over 3 years. If the US
non farm payrolls fails to meet expectations on Friday afternoon, the chances
of the Federal Reserve reining in their QE program become more unlikely. Ben
Bernanke has stated that he will maintain the current level of QE until

Despite the official jobs data from the US is due to be released on Friday,
viscous rumour circulated in the markets yesterday leading to a massive dollar
sell off. The result; a 3 month low for the dollar against the pound and the
euro and the largest fall against the Japanese Yen in over 3 years. If the US
non farm payrolls fails to meet expectations on Friday afternoon, the chances
of the Federal Reserve reining in their QE program become more unlikely. Ben
Bernanke has stated that he will maintain the current level of QE until
unemployment falls below 6.5%. The recent rally in global share prices will no
doubt react accordingly as uncertainty once again takes hold.

Unsurprisingly on Thursday the Bank of England and the ECB both held their
stance on interest rates and their own respective fiscal stimuli. Thoughts that
Mario Draghi’s words may weaken the euro were largely overshadowed by the
movements from the US however he also added that too much emphasis is applied
to ECB member’s individual comments and opinions and that the ECB remains
united in its plans going forward.

Friday‘s focus will most certainly be on the US as the week draws to a close.
Profit taking and market consolidation may see the US hold its ground over the
course of the day. As previous mentioned, this represents the best time in 3
months for dollar buyers. This afternoon’s trading session cold be key – will
the dollar manage to claw back some of the ground lost on Thursday?

Key Announcements:

9.30am – GBP – Trade balance (APR): Expected to fall to £-3bn

11.00am – EUR – German Industrial Production (APR): Expected at -0.8%

1.30pm – CAD – Unemployment Rate (MAY): Expected to remain at 7.2%

1.30pm – USD – Nonfarm Payrolls (MAY): Expected to rise to 170k