EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Retreats As Unemployment Rate Rises To 4.1%

U.S. Dollar

U.S. Dollar Index is losing ground as traders react to the Non Farm Payrolls report, which indicated that U.S. economy added 206,000 jobs in June. Analysts expected Non Farm Payrolls of 190,000, so the report exceeded analyst estimates. Unemployment Rate increased from 4% in May to 4.1% in June, compared to analyst consensus of 4%. Rising Unemployment Rate may signal that high interest rates put pressure on the labor market, so the Fed may start cutting rates soon. This scenario is bearish for the American currency.

In case U.S. Dollar Index stays below the 105.00 level, it will head towards the next support, which is located in the 104.40 – 104.60 range.

EUR/USD

EUR/USD gains some ground as traders react to the disappointing Industrial Production report from Germany. The report indicated that Germany’s Industrial Production declined by 2.5% month-over-month in May, compared to analyst consensus of +0.2%.  Today, traders also had a chance to take a look at the Euro Area Retail Sales report, which showed that Retail Sales increased by 0.1% month-over-month in May.

EUR/USD has recently settled above the resistance at 1.0785 – 1.0800 and continues to move higher. If EUR/USD climbs above the 1.0850 level, it will head towards the resistance at 1.0900 – 1.0915.

GBP/USD

GBP/USD tests new highs as traders react to the political developments in the UK. The country’s new PM Starmer promised to bring positive change. It remains to be seen whether he will be able to improve the economic situation in the UK, but traders are bullish on the British pound in the near term.

A successful test of the resistance at 1.2780 – 1.2800 will open the way to the test of the next resistance level at 1.2880 – 1.2900.

USD/CAD

USD/CAD is trying to rebound as traders take some profits off the table after the strong move. The rally in precious metals markets did not provide support to the Canadian dollar.

If USD/CAD manages to settle above the 1.3650 level, it will move towards the 50 MA at 1.3674.

USD/JPY

USD/JPY is losing ground as traders focus on the strong pullback in Treasury yields.

A move below the support at 160.00 – 160.50 will open the way to the test of the next support level at 158.00 – 158.50.

For a look at all of today’s economic events, check out our economic calendar.