The US Dollar (USD) showcased resilience against its counterparts on Thursday, buoyed by rising US yields. Despite the lack of risk aversion, as evidenced by the sturdy performance of US stock indexes, the currency faced challenges in outperforming later in the day. With no significant data releases expected from the Eurozone or the US on Friday, market focus shifted to Statistics Canada’s impending release of the January jobs report during the early American session.

Entering the European morning on Friday, the USD Index maintained its position slightly above 104.00, while the 10-year US T-bond yield moved sideways at around 4.15%. Although Wall Street’s primary indexes notched modest gains on Thursday, US stock index futures were observed trading marginally lower.

Analysing the percentage change of the US Dollar (USD) against major currencies throughout the week, it was noted that the USD exhibited weakness against the New Zealand Dollar.

Market expectations were set for the unemployment rate in Canada to rise to 5.9% in January, with the net change in employment anticipated to be at +15K following December’s lackluster 0.1K increase. USD/CAD hovered around 1.3450 ahead of the labor market data.

EUR/USD experienced a rebound during the latter half of Thursday’s trading session, closing nearly unchanged. Early Friday, the pair fluctuated within a tight channel below 1.0800. Italy’s Industrial Output data for December was slated for release later in the European session, while Germany’s Destatis confirmed a 2.9% rise in the annual Consumer Price Index for January.

GBP/USD, following a two-day rebound, lost momentum on Thursday, registering minor losses. Nevertheless, the pair maintained its position above 1.2600 in the early European session on Friday.

USD/JPY witnessed a sharp rise on Thursday, reaching its highest level since late November above 149.00. The pair remained in a consolidation phase below 149.50 as the final trading day of the week commenced.

Gold struggled to establish a definitive direction for the second consecutive day on Thursday. In the European session on Friday, XAU/USD continued to fluctuate within a narrow band above $2,030.

AUD/USD concluded Thursday’s session with losses but recovered above 0.6500 in the Asian session. Meanwhile, NZD/USD exhibited strength early on Friday, surging more than 0.5% to around 0.6100.

The US Dollar’s performance against its counterparts this week was marked by strength amidst a surge in yields. As markets awaited key data releases, including Canada’s jobs report, fluctuations in major currency pairs and commodities reflected ongoing market sentiment and economic expectations. With uncertainties lingering, investors remain vigilant for potential shifts in global economic dynamics influencing currency movements in the coming weeks.