When is the US monthly jobs report (NFP) and how could it affect EUR/USD?

US jobs report overview

Friday's US economic docket highlights the release of closely watched US monthly employment details, popularly known as NFP. The report is scheduled to be released at 12:30GMT and is expected to show that the US economy added 185K new jobs during the month of May, lower than the previous month's upbeat reading of 263K.

Meanwhile, the unemployment rate is expected to hold steady at a 49-year low level of 3.8% during the reported month. The key focus, however, will be on wage growth figures, which have gained more traction in the recent past. Average hourly earnings are foreseen to rise by 0.3% on a monthly basis as compared to 0.2% recorded in the previous month, while the yearly rate is anticipated to remain at 3.2%.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed, the reaction to the headline NFP print, in case of a relative deviation of -0.83 or +0.80, is likely to be in the range of 23-32 pips during the first 15-minutes and could stretch to 92-61 pips respectively in the subsequent 4-hours.

How could the data affect EUR/USD?

As Yohay Elam, FXStreet's own Analyst explains – “EUR/USD has created a double-top at 1.1310 after hitting this level twice this week. It is a critical level on the upside. Lower, it may struggle with 1.1280 which was a high point earlier this week and support beforehand, and also 1.1265 – a former triple-top.”

“Support awaits at 1.1220 which capped the pair in late May and was a low point this week. The post-ECB swing low of 1.1200 converges with the 50 Simple Moving Average. 1.1145, 1.1125, and 1.1107 – the lowest this year – are next down the line,” he added further.

Key Notes

   •  US Non-Farm Payrolls Preview: Worried but the signs are steady

   •  US NFP Preview: Major Banks expectations from May payrolls report

   •  EUR/USD Forecast: Four reasons to fall after failing to break resistance

About the US monthly jobs report

The nonfarm payrolls released by the US Department of Labor presents the number of new jobs created during the previous month, in all non-agricultural business. The monthly changes in payrolls can be extremely volatile, due to its high relation with economic policy decisions made by the Central Bank. The number is also subject to strong reviews in the upcoming months, and those reviews also tend to trigger volatility in the forex board. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish), although previous months reviews and the unemployment rate are as relevant as the headline figure, and therefore the reaction depends on how the market asses them all.