Citi discusses its expectations for the USD reaction around tomorrow's NFP report for the month of August.
"As a frame of reference, consensus estimates for NFP sit at 748k, while the Bloomberg ‘whisper’ figure lies higher at 800k. In case you missed it, Citi Economics provided their preview and call for an above consensus forecast of 850k. Nonetheless, the team flag greater uncertainty around the path of job growth in August with two-sided risks," Citi notes.
"Given still net-long broader USD positions – a release that undershoots the whisper and/or consensus estimate could buoy buying across Treasuries. The subsequent decline in yields would serve to accelerate recent greenback underperformance. A ‘goldilocks’ release that entails a slight miss would be most ideal for risk assets heading into an extended weekend," Citi adds.