📊 U.S. Employment Report: A Defining Moment for the Market
— The Unemployment Rate and “Two-Month Payrolls” Will Set the Year-End Direction —
■ 1. Market Backdrop: Post-FOMC Dollar Is in a “Data-Dependent” State
At last week’s FOMC meeting,
market attention shifted away from the dot plot (one rate cut next year) and focused instead on Chair Powell’s press conference.
Powell stated that:
“We are paying close attention to signs of cooling in the labor market.”
This reinforced the interpretation that the Fed is beginning to prioritize labor conditions over inflation, triggering renewed dollar selling.
Current market conditions reflect this stance:
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DXY: Rebounds remain shallow
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USD/JPY: Attempts to recover, but upside is capped
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Market psychology:
“Weaker labor = faster easing = USD downside risk” dominates
This is the context in which the market approaches today’s U.S. employment report.
■ 2. Why This Employment Report Is Particularly Tricky
Due to the impact of a partial U.S. government shutdown, this jobs report is structurally unusual and harder to interpret than usual.
● ① Unemployment Rate (November, single month)
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Previous (September): 4.4%
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Market consensus: 4.5%
The unemployment rate has risen steadily from around 4.0% at the start of the year to the mid-4% range.
👉 Even an in-line 4.5% print is likely to be interpreted as “continued labor market deterioration,” making it USD-negative.
● ② Nonfarm Payrolls (Combined October + November)
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Latest reference (September): +119k
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November standalone estimate: +50k
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Market expectation range: –20k to +130k
With no clear “normal” forecast for October, the market is likely to assess the data using:
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A two-month average (Oct–Nov)
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A comparison versus September
👉 As a result, initial market reaction is likely to prioritize the unemployment rate over payroll headlines.
■ 3. Simultaneous Release: U.S. Retail Sales Also in Focus
Alongside the employment report, October U.S. retail sales will be released.
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Headline (m/m): +0.1% (prior +0.2%)
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Ex-autos: +0.2% (prior +0.3%)
If both conditions are met:
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Labor data weak
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Consumer spending softening
👉 The market narrative shifts toward
“Labor + Consumption slowdown → stronger rate-cut expectations → accelerated USD selling.”
■ 4. UK Employment Data: Wage Strength Supports the Pound
UK labor market data released earlier in London highlighted persistent wage pressure.
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Average weekly earnings (y/y): +4.7% (vs. +4.4% expected)
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Ex-bonus earnings: +4.6% (vs. +4.5% expected)
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Previous figures revised higher
Meanwhile:
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Unemployment rate: 5.1% (as expected)
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Employment change: –16k (less severe than feared)
👉 The takeaway:
“Employment is slowing, but wage inflation remains sticky.”
As a result, the pound remained supported:
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GBP/USD: 1.3360 → 1.3370
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GBP/JPY: Held firm around the low-207 area
■ 5. Scenario Outlook (Key Focus)
▶ Base Case (In-Line or Soft Data)
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Unemployment rate: 4.5% or higher
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Payrolls: Low or subdued
→ Rate-cut expectations re-intensify, USD selling resumes
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USD/JPY: Downside pressure
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EUR/USD, GBP/USD: Upside tests
▶ Alternative Scenario (Upside Surprise)
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Unemployment rate: 4.4% or lower
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Payrolls: Above 100k
→ Market positioning is unprepared; risk of sharp USD rebound
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USD/JPY: Rapid short-covering rally
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JPY crosses: Spillover gains
👉 Volatility is likely in either direction.
■ 6. Summary
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Primary focus: U.S. employment report — unemployment rate is the key variable
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Data structure is irregular, increasing the risk of erratic market interpretation
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Weak data would reignite the post-FOMC USD downtrend
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Strong data could trigger year-end short-covering and sharp USD rebounds
📌 Around the release, traders should expect
wider spreads and violent, short-lived price swings.
This employment report may ultimately determine the dollar’s final directional bias heading into year-end.
