Nonfarm Payrolls (NFP) in the United States (US) rose by 130,000 in January, the US Bureau of Labor Statistics (BLS) reported on Wednesday. This reading followed the 48,000 (revised from 50,000) increase recorded in December and came in above the market expectation of 70,000.
Join our live coverage of the US NFP data and the market reaction.
Other details of the report showed that the Unemployment Rate edged lower to 4.3% from 4.4%, while the Labor Force Participation Rate ticked up to 62.5% from 62.4%. Finally, annual wage inflation, as measured by the change in the Average Hourly Earnings, held steady at 3.7%, compared to the market expectation of 3.6%.
“The change in total nonfarm payroll employment for November was revised down by 15,000, from +56,000 to +41,000, and the change for December was revised down by 2,000, from +50,000 to +48,000. With these revisions, employment in November and December combined is 17,000 lower than previously reported,” the BLS noted in its press release.
Furthermore the BLS announced the changes in 2025 employment figures after finalizing annual benchmark revisions:
“The seasonally adjusted total nonfarm employment level for March 2025 was revised downward by 898,000. On a not seasonally adjusted basis, the total nonfarm employment level for March 2025 was revised downward by 862,000, or -0.5 percent. Not seasonally adjusted, the absolute average benchmark revision over the prior 10 years is 0.2 percent. The change in total nonfarm employment for 2025 was revised from +584,000 to +181,000.”
Market reaction to Nonfarm Payrolls data
The US Dollar (USD) gathered strength against its major rivals with the immediate reaction. At the time of press, the USD Index was up 0.35% on the day at 97.23.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.52% | 0.24% | 0.15% | 0.32% | -0.12% | 0.28% | 0.65% | |
| EUR | -0.52% | -0.28% | -0.33% | -0.20% | -0.61% | -0.24% | 0.14% | |
| GBP | -0.24% | 0.28% | -0.08% | 0.08% | -0.34% | 0.03% | 0.42% | |
| JPY | -0.15% | 0.33% | 0.08% | 0.13% | -0.31% | 0.09% | 0.47% | |
| CAD | -0.32% | 0.20% | -0.08% | -0.13% | -0.43% | -0.04% | 0.33% | |
| AUD | 0.12% | 0.61% | 0.34% | 0.31% | 0.43% | 0.39% | 0.76% | |
| NZD | -0.28% | 0.24% | -0.03% | -0.09% | 0.04% | -0.39% | 0.37% | |
| CHF | -0.65% | -0.14% | -0.42% | -0.47% | -0.33% | -0.76% | -0.37% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
This section below was published as a preview of the US Nonfarm Payrolls data at 05:00 GMT.
- Nonfarm Payrolls are expected to rise by 70K in January.
- The Unemployment Rate is seen holding steady at 4.4%.
- The employment report could influence the Fed policy outlook and the US Dollar valuation.
The United States (US) Bureau of Labor Statistics (BLS) will release the delayed Nonfarm Payrolls (NFP) data for January on Wednesday at 13:30 GMT.
Volatility around the US Dollar (USD) will likely ramp up on the employment report, with investors looking for fresh insights on the US Federal Reserve’s (Fed) path forward on interest rates.
What to expect from the next Nonfarm Payrolls report?
The BLS reported early last week that it had postponed the release of the official employment report, originally scheduled on Friday, due to the partial government shutdown. After the US House passed a package on Tuesday to end the shutdown, the agency announced that it will release the labor market data on Wednesday, February 11.
Investors expect NFP to rise by 70K following the 50K increase recorded in December. In this period, the Unemployment Rate is expected to remain unchanged at 4.4%, while the annual wage inflation, as measured by the change in the Average Hourly Earnings, is projected to soften to 3.6% from 3.8%.
Previewing the employment report, TD Securities analysts note that they expect job gains to have remained subdued in January, increasing by 45K.
“We look for private to add 40K and government to add 5K. We expect private sector strength to be concentrated in healthcare and construction. We look for the Unemployment Rate to show continued signs of stabilization, remaining at 4.4%. The low-fire, low-hire labor market remains. Average Hourly Earnings likely increased 0.3% m/m and 3.7% y/y,” they add.
How will the US September Nonfarm Payrolls affect EUR/USD?
The USD started the month on a firm footing as markets reacted to the nomination of Kevin Warsh, who served as a Fed Governor from 2006 to 2011, as the new chair of the Fed. Meanwhile, the USD also benefited from the heightened volatility surrounding precious metals, especially Silver and Gold, and Stock markets. In turn, the USD Index, which gauges the USD’s valuation against a basket of six major currencies, rose 0.5% in the first week of February.
Fed Governor Lisa Cook said earlier in the month that she believes the labor market will continue to be supported by last year’s interest rate cuts. Cook further noted that the labor market has stabilized and is approximately in balance, adding that policymakers remain highly attentive to the potential for a rapid shift. Similarly, Governor Philip Jefferson argued that the job market is likely in balance with a low-hire, low-fire environment.
The CME Group FedWatch Tool shows that markets are currently pricing in about a 15% probability of a 25 basis-point (bps) rate cut in March. In case the NFP reading disappoints, with a print below 30K, and the Unemployment Rate rises unexpectedly, the USD could come under pressure with the immediate reaction, opening the door to a leg higher in EUR/USD. On the other hand, an NFP figure at or above the market expectation could reaffirm another policy hold next month. The market positioning suggests that the USD has some room on the upside in this scenario.
Investors will also pay close attention to the wage inflation component of the report. If Average Hourly Earnings rise less than expected, the USD could find it difficult to gather strength, even if the headline NFP print arrives near the market forecast.
Danske Bank analysts argue that softer wage growth could negatively impact consumer activity and pave the way for a dovish Fed action.
“The Challenger report showed more job cuts than expected in January and the JOLTs Job Openings came in at 6.5m in December (consensus 7.2m). Hence, the US ratio of job openings to unemployed fell to just 0.87 in December. Such cooling is usually a good predictor for weakening wage growth and may be a concern for the private consumption outlook and, all else equal, supports the case for earlier cuts from the Fed,” they explain.
Eren Sengezer, European Session Lead Analyst at FXStreet, offers a brief technical outlook for EUR/USD:
“The Relative Strength Index (RSI) indicator on the daily chart holds above 50 and EUR/USD fluctuates above the 20-day Simple Moving Average (SMA) after having tested this dynamic support last week, reflecting buyers’ willingness to retain control.”
“On the upside, 1.2000 (round level, psychological level) aligns as the next resistance before 1.2080 (January 27 high) and 1.2160 (static level). Looking south, the first key support level could be spotted at 1.1680, where the 100-day SMA is located, before 1.1620-1.1600 (200-day SMA, Fibonacci 23.6% retracement of the January 2025-January 2026 uptrend). A decisive drop below this support region could attract technical sellers and open the door for an extended slide.”
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates.
When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money.
When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions.
The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system.
It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
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