FX Closing Comments

After a tentative response to this morning non-farm payroll release, the Dollar picked-up from yesterday's gains, pushing the EUR/USD to 1.21. At 211,000, the lackluster figure was good enough for some analysts to surmise that the Fed might keep raising to 5.25%, instead of 5.00%. The feeling in now that the ECB will leave rates unchanged in May, which will prolong the Dollar's rate advantage for an extra couple of months. The re-energized Dollar also bumped the USD/JPY out of its recent wedge pattern. A full week awaits --look for this week's themes to remain: fluctuating rates expectations, outside political developments of all shapes and sizes (Scooter Libby, Iran and Iraq), and oil, which closed the week at $67.39 (CLK06).