The U.S. dollar fell Friday as February’s nonfarm payrolls missed forecasts, rising just 151,000 versus the expected 160,000. January payrolls were revised downward, and unemployment ticked up to 4.1%. Fed officials Powell and Kugler emphasized steady monetary policy amid easing inflation, keeping rate-cut expectations intact. Trump hinted at Russian sanctions, urging renewed Ukraine negotiations.

Euro Gains on Strong Economic Data, ECB Comments

EUR/USD surged nearly 1%, hitting a four-month high at 1.0786, supported by solid eurozone growth data (GDP +1.2% y/y) and ECB’s Centeno signaling easing inflation pressures. However, upside remained capped by caution over tariff risks and Germany’s political uncertainty regarding fiscal stimulus. Near-term resistance sits near 1.08; sentiment remains bullish.

Sterling Advances Modestly, EUR/GBP Gains Cap Upside

GBP/USD edged up 0.2%, supported by improved risk sentiment, though strong EUR/GBP flows limited gains. Technical levels near the 200-day moving average at 1.2786 remain crucial. Traders await Friday’s UK PMI data for direction amid moderate positioning.

Yen Volatile, Recovers Losses Post-U.S. Data

USD/JPY initially plunged to a five-month low at 146.94 following the weak U.S. jobs report, but later recovered losses on short-covering. Yen crosses, particularly EUR/JPY (+1.0%), firmed amid broader euro strength. Attention shifts to BoJ signals and Japanese economic data.

Treasury Yields and Equities Rebound

Treasury yields rose modestly, steepening the 2s-10s curve to +30.5bps. The S&P 500 reversed early losses, closing up 0.41%, as markets reassessed economic risks.

Commodities Mixed Amid Uncertainty

Oil climbed modestly (+0.5%) despite broader growth concerns. Gold held gains (+0.3%), while copper rallied (+1.5%) on stimulus optimism.

Market Outlook Cautious Ahead of Tariff Decisions

The dollar index fell 0.31%, AUD/USD slid 0.51%, reflecting cautious sentiment. Markets remain wary ahead of tariff and geopolitical developments.