The US dollar, euro and Sterling were little moved as traders get set for the all-important US payrolls jobs data. With China’s emergency interest rate cuts in August weighing on sentiment, this may have just caused a pullback in hiring by US firms last month. Weak data, suggesting the Federal Reserve will probably hold off on raising rates at least until December 2015, could hurt the US currency and lift GBP/USD above five-month lows. The Swiss franc was sold across the board after Swiss National Bank vice chairman Fritz Zurbruegg said he was confident that the bank’s negative rates and FX intervention policy would weaken the Swiss currency further.

US dollar

A potentially pivotal US employment report will be the focus for currency markets. However, it is expected to disappoint those economists who feel the Federal Reserve will raise rates on October 28. With China’s emergency rate cuts in August weighing on sentiment, a pullback in hiring by US firms is possible. Weak data would suggest the Fed will have to rule out an October hike and hold off on raising rates at least until December, and this could hurt the US currency. The US dollar edged lower, with US factory data adding to the uncertainty around US rates with the monthly ISM Manufacturing PMI fell more than expected in September.

Sterling

The UK manufacturing PMI report did little to suggest the Bank of England would move any closer to raising rates, keeping the pound stuck near five-month lows against the US dollar. Monday’s more influential UK service sector data will be closely watched to judge how hawkish the Bank of England will sound next week. The BOE makes its next interest rate announcement on Thursday.

Swiss Franc

The Swiss franc slid against the euro, US dollar and yen as traders sold the currency before the speech from the Swiss National Bank’s Fritz Zurbruegg. Zurbruegg said economic developments abroad, meaning China, were crucial and that he is convinced the franc will still weaken further. The SNB has adopted negative interest rates and FX intervention to weaken the franc and help boost growth and inflation. The haven franc appreciates in times of risk aversion and has gained by two per cent against Sterling in the past 30 days.

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