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EUR/USD Slumps as NFP Surprises with Stellar Reading

November 6, 2015 by

EUR/USD sank more than 1 percent today after US nonfarm payrolls demonstrated impressive growth that was way bigger than forecasts had promised. Now, the market prices in a big probability of an interest rate hike from the Federal Reserve as soon as the next month. Of course, this is very beneficial for the US dollar.

Nonfarm payrolls climbed by 271k in October. That is compared to the median analysts’ forecast of 181k and the September’s meager increase by just 137k. Unemployment rate ticked down unexpectedly from 5.1% to 5.0%. Average hourly earnings increase by 0.4% after showing no change during the preceding month. Experts had predicted a smaller rise by 0.2%. (Event A on the chart.)

Consumer credit demonstrated substantial growth by $28.9 billion in September. It was far bigger than the consensus forecast of a $17.6 billion increase and the August’s gain by $16.1 billion. (Event B on the chart.)

Yesterday, a couple of reports were released. (Not shown on the chart.)

Initial jobless claims demonstrated an increase from 260k to 276k last week, above the forecast level of 263k.

Nonfarm productivity edged up 1.6% in Q3 2015. The advance was smaller than 3.3% reported for the previous quarter (the big revision from the initial reading of 1.3%) but bigger than 0.1% predicted by analysts.

EUR/USD for 2015-11-05

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