Markets Await US Jobs Report by Korman Tam

At 1:00 AM Japan July Leading Indicator (exp n/f, prev 72.7)
Japan July Coincident Indicator (exp n/f, prev 80.0)
At 2:00 AM Germany July Trade Balance (exp 15.5 bln euros, prev 14.9 bln euros)
At 7:00 AM Canada August Unemployment Rate (exp 6.0%, prev 6.0%)
Canada August Jobs-Change (exp 18k, prev 11.3k)
At 8:30 AM US August average earnings (exp 0.3%, prev 0.3%)
US August non-farm payrolls (exp 110k, prev 92.0k)
US August unemployment rate (exp 4.6%, prev 4.6%)
At 10:00 AM US July Wholesale Inventories (exp 0.4%, prev 0.5%)
The major currency pairs traded narrowly in the early Tokyo session, as traders direct their focus to the closely watched US labor report. A key driver in FX movement continues to be sentiment over global central bank decisions, with the ECB and BoE both keeping rates unchanged yesterday.

US economic reports will be closely scrutinized for its potential impact on the upcoming FOMC policy setting meeting on September 18th. Although many are expecting the Fed to cut rates by 25-bp -- lowering the Federal funds rate to 5.0%, the decision is not a foregone conclusion. Comments from Fed board members recently have suggested the FOMC is not ready to move given the outlook for inflation. The recent liquidity injections and reduction in the discount rate have eased credit conditions somewhat and may buy the Fed another month before cutting its benchmark-lending rate.

The key highlight for the session ahead will be the US August jobs report. Consensus forecasts are calling for non-farm payrolls to improve to 110k, up from July at 92k. Average earnings are seen remaining unchanged at 0.3% and the unemployment rate is also expected to stand pat at 4.6%. Firm jobs data could prop the dollar higher against the majors on prospects that improving labor conditions may sway the Fed into remaining unchanged in a few weeks.

Canada will also release jobs data for August, with the unemployment rate unchanged at 6.0% and jobs-change edging up to 18k from 11.3k previously.

The euro maintains its buoyant tone against the dollar, hovering just below 1.37. We anticipate the single currency to continue to creep higher versus the greenback, with resistance starting at 1.37, followed by 1.3750 and 1.38. Additional ceilings are eyed at 1.3850 and 1.39. On the downside, support begins at 1.3620, backed by 1.36 and 1.3550. Subsequent floors will emerge at 1.3520, followed by 1.35 and 1.3460.ok friend enjoy your forex online trading.