EUR/USD continues delivering a solid performance, trading with strong hands near the 1.1460 area on Friday. Employment disappointments from the States resulted in a weakening of the US Dollar. As expected, we are witnessing an increase in certain financial indicators fiduciaries may find alarming. The currency pair rallied to daily highs immediately after the US NFP report was released. July’s disappointing jobs surprise was reflected in the overall economy adding just 73,000 jobs—well short of the 100,000 new jobs economists were expecting.
This underwhelming job growth has resulted in considerable US Dollar selling pressure. The dollar’s decline contributed to the formation of a bullish pattern for EUR/USD that was strengthened as the dollar weakened. The impressive resilience of the euro area economy this summer. Recent commitments, such as the EU-US trade deal and Germany’s plans for increased spending, are powering this resilience.
The European Central Bank (ECB) has played a role in shifting market dynamics as well with its recent announcements. It pointed to no extra cuts to the benchmark interest rate anywhere on the horizon. The outlook remains very, very cautious. Risks continue to point to a potential final cut by the end of this year or early 2026. Analysts believe that more signs of weakness on the wage front would clear a path for an ‘insurance cut’ from the ECB.
Against this backdrop of currency volatility, gold prices have been climbing sharply. They have jumped to record prices of over $3,330 per troy ounce. This increase comes in anticipation of the upcoming US Nonfarm Payrolls release. The weak performance of the US Dollar has played a big role in this spike. Though readily influenced as traders respond to pivotal economic developments, gold has sported a wide consolidative tone, gaining even further momentum on Friday.
“Gold advances to fresh highs around $3,330 after US NFP.” – Source
Market analysts noted that brokers are providing competitive spreads and fast execution for trading EUR/USD, making it an attractive option for investors during this period of volatility.