US non-farm payrolls landed at 194k vs. forecast at 488k, JPY down to its 3-year low due to rising energy costs

Last Friday, the US reported its September nonfarm payrolls. The figures are quite disappointing as they landed at 194k. The forecast was at 488k. However, the unemployment rate fell to 4.8%, versus the expectation at 5.1%. DXY Index dropped below the 94-level after the data was released, but it has climbed back to 94.34 at press time.

JPY has hit a fresh three-year low, with USDJPY currently trading at 113.32. The sharp fall was primarily due to the rising energy prices, which will likely increase demand for USD against JPY. Japan is a net energy importer, so spiking energy prices will add more costs for the country. Moreover, BoJ will likely be the last major central bank to consider tightening its monetary policy. This tendency has also contributed to the consistent downward trend on the currency.