Forex Today: US jobs data takes centre stage as Midterms hangover lingers

Broad selling pressure weighed on the US Dollar (USD) on Wednesday, pushing it towards five-week lows at one stage as investors weighed the Democrats’ stunning victory in the US midterm elections.

After falling to within a few pips of the 101.00 support zone, the US Dollar Index (DXY) attempted a subdued rebound. The data calendar features the regular weekly Initial Jobless Claims report alongside Challenger Job Cuts.

Broad-based US Dollar weakness helped EUR/USD extend its recovery for the week, with the pair testing multi-week highs around 1.1270. On the data front, the S&P Global Construction PMI readings for Germany and the Eurozone are due, together with Germany’s Factory Orders and Producer Prices for the wider euro area.

A sixth straight daily gain took GBP/USD briefly above the 1.3500 threshold for the first time since mid-September. At its upcoming meeting, the BoE is expected to lift its policy rate to 4.00%. The only notable data release will be the S&P Global Construction PMI.

Following another failed attempt around 158.80, USD/JPY traded modestly lower, reversing two consecutive daily gains. The calendar includes the final S&P Global Services PMI reading, the BoJ Minutes and a 10-Year JGB Auction. 

A rebound from near three-week lows carried AUD/USD back above the key 0.7000 level, where it traded marginally higher. Australia’s next releases are the final Building Permits and Private House Approvals figures on November 9.

The weekly pullback in front-month WTI futures (December contract) deepened, taking prices towards three-week lows near $91.00 per barrel. Traders continued to weigh the prospect of a possible end to the US-Iran crisis after the Democrats’ victory in the US midterm elections.

A sharp US Dollar sell-off and lower US Treasury yields across the curve lifted Gold back above the key $4,000 level per troy ounce, with the metal also reaching fresh four-day highs.