· The US Bureau of Labor Statistics on Friday reported that Nonfarm Payrolls in September increased by 136,000 following August's reading of 168,000 (revised from 130,000) and came in weaker than the market expectation of 145,000.
With the initial reaction, the US Dollar Index edged higher and was last down 0.03% on the day at 98.87.
The unemployment rate dropped to a near 50-year low of 3.5%.
· The dollar slipped on Friday after earlier posting gains following a U.S. jobs report that underperformed expectations but was solid overall, as investors remained cautious about political risk in the United States and ongoing trade negotiations with China.
The greenback hit session highs against the yen and euro following the jobs report, after trading lower for most of the session. But by afternoon trading, the dollar’s rally faded.
A drop in U.S. unemployment in September pushed traders of U.S. short-term interest rate futures on Friday to pare bets the Federal Reserve will cut rates at both of its two upcoming meetings.
In early afternoon trading, the dollar index was down 0.1% at 98.805, slipping against the yen to 106.82 yen. The euro gained 0.2% versus the dollar to $1.0982.
· Diplomatic texts released late Thursday showed that U.S. officials pressured their Ukrainian counterparts to launch investigations that could benefit President Donald Trump’s personal political agenda in exchange for a meeting between the two countries’ leaders. The exchanges were released by Democrats in the House of Representatives as part of an impeachment investigation to determine whether Trump pressed Ukraine to probe former Vice President Joe Biden and his son, Hunter Biden, in connection with Ukrainian gas company Burisma. Trade talks with China were also in focus, with both U.S. and Chinese officials set to meet next week.
· President Donald Trump’s appeal to China to investigate his political rival Joe Biden has increased the pressure on the president at home, but it may not affect high-stakes trade talks with China in a meaningful way.
On Friday, a day after he said that “China should start an investigation” into the former vice president and his son Hunter, Trump himself said he would keep trade talks and his Biden concerns separate.
· The U.S. economy is chugging along despite the headwinds it faces, Federal Reserve Chair Jerome Powell said on Friday, in remarks that gave little more away about the path of monetary policy.
“While not everyone fully shares economic opportunities and the economy faces some risks, overall it is — as I like to say —in a good place. Our job is to keep it there as long as possible,” Powell said in brief remarks introducing a “Fed Listens” event at the U.S. central bank’s headquarters in Washington.
· Atlanta Federal Reserve Bank President Raphael Bostic said on Friday he does not think the U.S. economy is heading into a recession and that stimulus from the Fed should help overcome “bumps” in the road to prolong the expansion.
· Kansas City Federal Reserve Bank President Esther George on Sunday rejected the notion that the U.S. central bank should cut interest rates to try to boost low inflation, adding that doing so could create financial imbalances.
“In current circumstances, concern about low inflation seems unnecessary,” George said in remarks prepared for delivery to the National Association for Business Economics. “In the absence of more evidence that the downside risks may be realized, muted inflation alone would not warrant a policy response.”
· Boston Federal Reserve Bank President Eric Rosengren, who opposed the U.S. central bank’s two interest-rate cuts this year, said Friday he is open minded on the path of policy but gave little hint he’s particularly worried about slowing growth.
“We’re getting to the point where we are getting about the kind of employment growth that I would expect in kind of a stable economy,” Rosengren told CNBC in an interview. “I think the bigger question is whether it ends up being weaker from here and that depends importantly on what happens on the consumer side of the economy.”
· Chinese officials are growing hesitant to pursue a broad trade deal with the U.S. in negotiations set to begin this Thursday, people familiar with the matter told Bloomberg News.
Vice Premier Liu He, who will lead negotiations for China, told dignitaries that his offer to the U.S. will not include commitments on reforming Chinese industrial policy or government subsidies, according to to Bloomberg. These are among the Trump administration’s main demands in the trade talks.
· Spain has summoned the U.S. ambassador in Madrid to express its complete rejection of any new U.S. tariffs on European Union goods and will press for strong counter measures if they are confirmed, the acting government said on Friday.
· North Korea’s top negotiator said late on Saturday that working-level nuclear talks in Sweden between officials from Pyongyang and Washington had broken off, dashing prospects for an end to months of stalemate.
The North’s chief nuclear negotiator, Kim Myong Gil, who spent much of the day in talks with an American delegation, cast the blame on what he portrayed as U.S. inflexibility, saying the other side’s negotiators would not “give up their old viewpoint and attitude”.
The U.S. State Department said those comments did not reflect “the content or spirit” of more than 8-1/2 hours of talks, and Washington had accepted Sweden’s invitation to return to Sweden for more discussions with Pyongyang in two weeks.
· North Korea said on Sunday there was no way the United States would bring alternative plans for their stalled nuclear talks to a meeting proposed by Stockholm in two weeks after weekend negotiations in Sweden broke down.
It is unclear whether North Korea will return to the talks, but Pyongyang could be using its strategy of negotiating on the edge to gain concessions as fringe benefits of participating in negotiations, experts say.
· Oil prices rose about 1% on Friday as an increase in U.S. jobs eased some financial market concerns that a slowing global economy could dent oil demand, but crude fell more than 5% on the week, its second consecutive weekly decline.
Brent crude LCOc1 futures gained 66 cents, or 1.14%, to settle at $58.37 a barrel. West Texas Intermediate (WTI) crude CLc1 futures rose 36 cents, or 0.7%, to settle at $52.81 a barrel.
Brent futures fell 5.7% for the week, its biggest weekly drop since July. WTI lost 5.5% for the week, also its steepest fall since July.
· Iran will not succumb to U.S. pressure and will use every possible way to export its oil, Iranian Oil Ministry’s website SHANA quoted Oil Minister Bijan Zanganeh as saying on Sunday.
Iran’s crude oil exports were reduced by more than 80% when the United States re-imposed sanctions on the country last November after President Donald Trump pulled out of Iran’s 2015 nuclear deal with world powers.
Reference: CNBC, Reuters, FXStreet
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