By Publishing Editors Payrolls beat propels dollar higher as supersized Fed bets wilt Market Briefs • Blowout US employment report reinforces economy's resilience • US Sep Non-Farm Payrolls 254k, 140k f'cast, 142k prev, 159k r’vsd • US Sep Private Payrolls 223k, 125k f'cast, 118k prev, 114k r’vsd • US Sep Unemployment Rate 4.1%, 4.2% f'cast, 4.2% prev • US Sep Average Earnings YY 4.0%, 3.8% f'cast, 3.8% prev, 3.9% r’vsd; MM 0.4%, 0.3% f'cast, 0.4% prev, 0.5% r’vsd • Fed seen slowing rate cut pace after strong US jobs data • Fed's Goolsbee calls jobs report 'superb,' still sees rate cuts ahead • Surging jobs, wages, keep Fed base case of quarter point cuts on track • BofA now expects Fed to cut by 25 bps in November • Global supply chain pressures easing, New York Fed index shows • Canada's Ivey PMI shows activity expanding in September • CA Sep Ivey PMI 54.5, 50.3 prev • CA Sep Ivey PMI SA 53.1, 48.2 prev • ECB's De Guindos says euro zone inflation heading toward 2% goal by end-2025 Looking Ahead - Economic Data (GMT) • 02:00 Sep NZ Reserve Assets Total NZD 32,574 mln prev • 04:00 Q4 CN Overall Comprehensive Risk 2.40 prev • 04:00 Q4 JP Overall Comprehensive Risk 9.08 prev • 04:00 Q4 NZ Overall Comprehensive Risk 9.46 prev Looking Ahead - Events, Other Releases (GMT) • No major events scheduled Macro Themes in Play • The dollar index vaulted higher Friday and was on pace for its best week in two years following a strong U.S. jobs report for September. • Non-farm payrolls increased a more-than-forecast 254k on the month, the unemployment unexpectedly fell and hourly earnings grew faster than expected. • Odds of another supersized rate cut by the Fed in 2024 were erased after the data and markets now foresee two 25 basis point reductions by year end. • Chicago Fed President Austan Goolsbee said, via a Bloomberg TV interview, that he does not want to react to one data point and that policymakers must be careful keeping rates as restrictive as they currently are. • Canada’s Ivey PMI index moved back above 50 in September, indicating economic growth. • The Bank of England should move only gradually with cutting interest rates, Chief Economist Huw Pill said Friday. • The yen slumped after the U.S. data and was set for its worst week since 2009. • Israel said it targeted the intelligence headquarters of Hezbollah in Lebanon and the U.S. struck Houthi targets in Yemen Friday. • Treasury yields were 8-20 basis points higher as the curve flattened. The 2s-10s curve was down about 8 basis points to +5.6bp. • The S&P 500 rose 0.53%. • Gold dipped 0.30% as Treasury yields firmed. • Copper edged up 0.32% as demand expectations built after the U.S. data • Oil climbed 0.69% amid concerns Middle East supplies are at risk. • Heading toward the close: EUR/USD -0.57%, USD/JPY +1.26%, GBP/USD -0.04%, AUD/USD -0.61%, DXY +0.55%, EUR/JPY +0.70%, GBP/JPY +1.38%, AUD/JPY +0.72%. Commentary and Analysis EUR/USD-Spreads widen, Fed rate cut pace may slow on jobs data • NY opened near 1.1025 after 1.10395 traded overnight, drop then extended • Big upside beat to jobs data spiked up yields US2YT=RR & the US$ • DE-US 2-yr spreads US2DE2=RR widened sharply; USD/CNH rallied to 7.1036 • Gold traded lower which reinforced the bid for the dollar • EUR/USD neared 1.0960, bounced slightly then hit 1.09515 on EBS • The pair traded down -0.60% late in the day and techs leaned bearish • Pair held below the 55-DMA & daily cloud top, daily & monthly RSIs falling USD/JPY posts stellar start to new quarter • USD/JPY is closing its best week since 2009 above the weekly Ichimoku cloud top of 148.38 on EBS • May add to gains after closing above its daily upper Bollinger at 147.49 though first week of October is usually volatile • Daily 14-day RSI will likely turn overbought in coming sessions • Critical resistance is near 151.81, the top of the daily cloud, above 149.40 Aug. 15 high and 150.00 psychological level • Further supports are seen at 147.16, the Sept. 3 high, and
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