EURUSD is holding its ground. Overview for 07.11.2023

The primary currency pair is facing a retreat on Tuesday. The current EURUSD exchange rate stands at 1.0706.

Risk sentiment in the global foreign exchange market has become notably complex, benefitting both the USD and the EUR.

The macroeconomic calendar brought forth the statistics from the eurozone on Monday. The final services PMI remained at 47.8 points in October. This figure is below the psychologically critical threshold of 50 points, distinguishing a decline from growth. The Sentix investor confidence index in the eurozone increased in November, coming in at -18.6 points, surpassing the forecast of -22.2 points.

Friday’s statistics on the US employment sector in October demonstrated the full potential impact of a strict monetary policy on the economy. The unemployment rate increased to 3.9%, even though no changes were expected. The average hourly earnings rose by 0.2 m/m, falling short of the consensus. Non-farm payrolls increased by 150,000, falling below the expected 178,000 and representing nearly half of the increase seen last month.

Why is this significant? The reason is that the majority of the working-age population is engaged in this employment sector, which contributes to over 80% of the GDP. Employers have reduced competition for workers and cut jobs in October, meaning they see either declining economic demand or difficult circumstances for development.

Today, it is worth paying attention to a daily report on the eurozone’s producer price index and the US trade balance. However, overall risk aversion remains in the spotlight.