US Dollar Strengthens After 165,000 Jobs Gain as Trump Premium Unwinds

2 articles · Updated · litefinance.org · Nov 9

EUR/USD stayed under pressure after October nonfarm payrolls rose 165,000—well above forecasts—reinforcing the dollar’s rebound and keeping the pair in a bearish trend below 1.1190.
80,000 upward revisions to August and September payrolls and a 4.1% unemployment rate pointed to a still-resilient labor market, giving investors more reason to favor the greenback.
Fed expectations firmed with December hike odds rising to 76% from 66%, while derivatives markets lifted the chance of two rate increases over the next 12 months to 63% from 52%.
The dollar also benefited from the unwinding of the Trump premium after Democrats’ midterm win, as markets removed support tied to a president who had favored a weaker dollar and lower rates.
A continued stock sell-off could still complicate Fed tightening, but for now stronger fundamentals and shifting political pricing are driving the euro-dollar move.