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- EUR/USD bounces up from 1.1833 lows but remains below the 1.1900 level.
- Strong US Nonfarm Payrolls provided a moderate boost to the US Dollar.
- On Thursday, the focus will be on the speeches from ECB officials.
The Euro (EUR) shows marginal gains against the US Dollar (USD) on Thursday, trading at 1.1880 at the time of writing, up from Wednesday's lows at 12.1833. The pair is trimming previous losses amid a moderate risk appetite and with the positive impact of the strong US Nonfarm Payrolls (NFP) report on the USD fading.
January's delayed US NFP report showed a 130K increase in net employment, almost twice the 70K forecasted by market analysts, and the Unemployment Rate declined to 4.3% from 4.4% in the previous month.
An excessive concentration of employment creation, with the healthcare sector accounting for nearly two-thirds of January's payrolls and a sharp downward revision to 2025 figures, somewhat tempered investors' optimism. Wednesday's data, however, has eased concerns about the health of the US labour market, triggered by the downbeat ADP Employment Change and JOLTS Job Openings released last week.
The Fed is unlikely to cut rates before June
Futures markets have scaled back bets of Fed rate cuts in the coming months following the NFP report. The odds for monetary easing in March have dropped to 5% from 20% pre-NFP, and the chances of a rate cut in April have dropped to 20% from above 40%, according to the CME's Fed Watch Tool. Investors still see a 60% chance of an easing move in June, the first monetary policy meeting with Kevin Warsh in the central bank's chair.
In the economic calendar on Thursday, the focus will be on the speeches of European Central Bank Board members, Piero Cipollone, Philip Lane, and Bundesbank President Joachim Nagel.
In the US, Initial Jobless Claims and Home Sales figures might provide some distraction, although traders might remain cautious ahead of Friday's Consumer Prices Index, for a more complete assessment of the Fed's monetary policy path.
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