Euro Edges Higher Ahead of US Nonfarm Payrolls Data
The Euro (EUR) is trading slightly higher against the US Dollar (USD) at around 1.1600 during the early European session on Thursday, but remains broadly sideways as investors await the US Nonfarm Payrolls (NFP) data for August.
The NFP report will provide fresh cues regarding the Federal Reserve's (Fed) monetary policy expectations, with TD Securities warning that a firm NFP may increase hike fears, but inflation keeps markets nervous and the reaction asymmetric.
According to TD Securities, investors are reluctant to fully price in a more aggressive Fed path until they see the next Consumer Price Index (CPI) print. On the other hand, a modestly softer payroll print would allow the market to lower pricing for a September rate hike, underscoring their view that downside surprises in employment data are more likely to be reflected in near-term policy expectations than upside ones.
In technical analysis, EUR/USD is holding just above the 20-period exponential moving average (EMA) at 1.1594, suggesting a mildly bullish near-term bias as price defends this dynamic support zone. The Relative Strength Index (14) sits in neutral territory with a slight positive tilt, hinting that upside momentum is constructive but not overstretched.