U.S. Dollar Pulls Back Following Non-Farm Payrolls Report

Key Highlights:

· The U.S. Non-Farm Payrolls highlighted an increase in jobs from 185,000 to 187,000.

· Treasury yields retreated from their multi-month highs as job reports fell short of analysts' expectations.

· The U.S. Dollar Index slipped below 102 as a reaction to market anticipation of a less aggressive Fed stance.

On August 4, the U.S. Non Farm Payrolls report was released, stating that in July, the U.S economy added a total of 187,000 jobs, less than the anticipated 200,000 that analysts had predicted. There was a decline in the Unemployment Rate from 3.6% in June to 3.5% in July, this was against the expected unchanged rate of 3.6%.

Following the release of the report, Treasury yields retreated from their several months' highs. This weaker economic performance indicated that the labor market started feeling the strain from high interest rates, leading to a bullish sentiment towards bonds due to the expectation of less aggressive Federal Reserve actions in upcoming meetings.

The U.S. Dollar Index saw a decline, falling below the 102 mark due to traders shifting their attention towards the pullback in Treasury yields. The aim now is to dip below the 101.80 level.

Gold prices edged towards the $1945 level, propelled by a weakening dollar and declining Treasury yields. Despite this boost from the Non Farm Payrolls report, it's unclear whether the gold market can sustain its momentum, given the current limited demand for safe-haven assets.

Stock index SP500 scaled upwards towards the 4530 level, reacting to the reported job numbers. While the declining job market indicates an economic slowdown, traders are wagering on a less assertive Federal Reserve policy, which is a key determinant of major indexes.

To stay updated on all economic activities today, please refer to our economic calendar.