Citi commented on the potential impact of the upcoming jobs report on USD. In a report to be released on Friday, markets predict different outcomes for US dollar currency pairs such as and , based on different non-farm payrolls (NFP) data scenarios.

Citi analysts suggest that if NFP data meets or exceeds consensus expectations, it could lead to an escalate in USDJPY and USDCHF. Additionally, foreign currencies with a higher beta value may also see a marginal escalate against the USD due to the reduced risk of recession.

Conversely, if NFP data misses expectations slightly, USDJPY and USDCHF could fall, but the Federal Reserve’s dovish repricing could provide support for risky assets, allowing higher beta currencies to potentially outperform against the USD.

In the case of the clearly weaker NFP, forecast by Citi Economics at the level of PLN 70,000. up-to-date jobs and an unemployment rate of 4.3%, both USDJPY and USDCHF may decline significantly. This scenario could also put pressure on higher beta currencies if increased risk aversion triggers a “bad news is bad news” market reaction.

Citi’s analysis also highlights two critical issues related to the upcoming jobs report. First, a stronger-than-expected report could have a negative impact, especially if the European Central Bank’s U-turn narrative gains traction and the market trends towards EUR selling.

Second, the range of possible data outcomes could leave Federal Reserve and U.S. dollar policy in a state of uncertainty. Federal Reserve Chairman Jerome Powell’s recent measured rhetoric and the proximity of the next labor market report before the Federal Open Market Committee’s November meeting could limit market moves unless there is an extreme deviation in the data.

This article was generated with the assistance of AI and reviewed by an editor. More information can be found in our Regulations.