Commerzbank: US dollar is unlikely to strengthen even on optimistic non-farm payrolls
The issue of inflation is currently of less importance in the foreign exchange market. Thus, according to economists at Commerzbank, dollar bears will not suffer losses even on the release of optimistic nonfarm payrolls.
Should the November labor market report look upbeat, the last dollar bulls may become enthusiastic on high wage inflation. The labor market tends to be the last market to change the rate of inflation. That’s why the bears may not change their mind today even on a positive labor report.
Economists also point to the speed at which the currency market anticipates events. They make dollar exchange rate forecasts for the coming year, given the fact that the market assesses inflation risks step by step. However, if market events show up more rapidly, EURUSD will hit 1.10 more quickly.
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