US dollar slumps as the market latches onto softer jobs hopes | Forexlive

If there was ever a report to ignore it’s today’s initial jobless claims data.

Claims were higher at 211K compared to 195K and that’s the highest since the week of Dec 24 but it’s only one week. Even more importantly, tomorrow is the non-farm payrolls report and this data didn’t cover survey week. Indeed the data for survey week showed the lowest claims in nine months.

So you can argue that the dollar sellers here are foolishly optimistic and could easily get blown up by non-farm payrolls tomorrow.

Alternatively, you could argue that the smallest crack in the jobs picture, like today’s initial jobless claims report, exposes a market that’s too crowded into US dollars and too invested in the idea of a 50 bps hike on March 22.

Right now market pricing for March 22 is 66% for 50 bps. There will be a big swing on that number tomorrow after the jobs report.