Debt Ceiling Fears Ease, Focus Shifts To NFP Report

Good morning, it’s NFP day. The U.S. payrolls report is estimated to show a gain of 500k jobs in September that could also cement expectations that the Federal Reserve will soon start tapering bond purchases.

As for the U.S. debt ceiling, the risk of a potential default later this month had been averted (at least for now) as Congressional leaders in Washington appeared to agree to a short-term deal to raise the debt limit. However, the short-term agreement does not solve the larger problem of a looming default for the largest global economy.

The U.S. dollar was steady ahead of today’s NFP report which is scheduled for release at 12:30 UTC. If data beat expectations the greenback will further rise as the market can start to price in a more aggressive Fed rate hike cycle.

We will know more later. However, traders should be cautious and brace for higher volatility.

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