ECB Expected to Raise Rates as Markets Eye Key Jobs Data

The European session is quiet today, with only low-tier releases such as German factory orders and Eurozone retail sales. These numbers are not expected to have a significant impact on the European Central Bank's (ECB) upcoming decision to increase interest rates. However, ECB policymakers may signal less appetite for further tightening, which could be seen as a positive sign by the market.

In contrast, the American session will see the release of key data from Canada and the US. The Canadian jobs report is expected to show a modest gain in employment change, while the unemployment rate is seen steady at 6.4%. Meanwhile, the US Non-Farm Payrolls (NFP) is also due for release, with expectations of a job gain of 55K after a previous decline of 23K.

The Bank of Canada (BoC) has already taken a more hawkish stance this week by keeping interest rates unchanged but warning of increased inflation risks. The Canadian dollar rallied strongly in response to the BoC's decision, and any strong jobs report could further boost the currency.