Chicago Fed President Charles Evans has recently said that the central bank is sticking to its mandate to bring inflation down even if it means people will lose their jobs. This means that interest rates will remain at the highest possible level for a long time regardless of the economy slipping into recession, or the labor market deterioration.
According to the data presented by the US Department of Labor, the number of non-farm payrolls increased by 263,000 in September, while the unemployment rate fell to 3.5%. This is quite good data, but Fed officials, including Chairman Jerome Powell, warned that the end result of the central bank's efforts to curb inflation could lead to the deterioration of the labor market. Most likely, unemployment will surge amid tight monetary policy.
Talking about EUR/USD, quotes have reached the support level of 0.9680, but now there is a slight correction ahead of an important inflation report in the US. To resume growth, it is necessary to break above 0.9730, as only that will push the quotes to 0.9775 and 0.9810. Meanwhile, a break of 0.9680 will restore pressure on the pair and push it to 0.9640, 0.9590 and 0.9540.
As for GBP/USD, it continues to decline, so buyers are focused on defending the support level of 1.0930 and resistance level of 1.1050. Only the breakdown of the latter will open the path to 1.1120, 1.1180 and 1.1215. Meanwhile, a return of pressure and move under 1.0930 will push GBP/USD down to 1.0870 and 1.0800.