All eyes are on the US labor market

The greenback succumbed to expectations of a potential 50bps rate cut by the Fed later this month after data signaled further cooling in the US labor market, all ahead of crucial metrics later in the week.

Here’s what you need to know on Thursday, September 5:

The U.S. dollar index ( DXY ) fell to multi-day lows near 101.20 amid market talk suggesting more rate cut and lower U.S. yields. The key ADP hiring change will take center stage on September 5, backed by weekly initial jobless claims, final S&P Global Services PMI and ISM Services PMI.

EUR/USD regained composure and flirted with the 1.1100 barrier amid renewed greenback bearish bias. German factory orders will be released on September 5, along with HCOB Construction PMI in both Germany and the euro area and retail sales in the euro bloc.

Widespread bullish sentiment in the risk complex lifted GBP/USD back above the 1.3100 mark, briefly making weekly highs. September 5 will see new car sales followed by the final S&P Global Construction PMI.

Further appreciation in the Japanese yen, lower yields and a marked pullback in the US dollar helped USD/JPY retest the 144.00 region, adding to Tuesday’s decline. Average cash earnings and foreign bond investment weekly figures are expected on September 5.

In a fairly volatile day, AUD/USD barely changed above 0.6700 amid Chinese concerns, a weaker dollar and falling commodity prices. Trade Balance results and RBA M Bullock’s speech scheduled for September 5th.

WTI prices fell to fresh YTD lows near the $69.00 per barrel mark amid prevailing bearish sentiment among traders.

Gold prices alternated between gains and losses just below the $2,500 per troy ounce mark, despite the greenback’s lower move and the negative performance of US yields. Silver saw a glimmer of hope following the dollar’s bearish tone and advanced modestly above the $28.00 per ounce mark.