US Dollar Holds Steady Ahead of Crucial June Jobs Report
July 3, 2025 | By Greg Michalowski
The US dollar is showing little change and mixed movements against major currencies as markets brace for the release of the highly anticipated US employment report. The report, which will be released a day early due to the Independence Day holiday, is expected to provide fresh insights into the health of the American labor market and influence currency and bond markets going forward.
Currency Market Snapshot
As of midday Thursday, the US dollar remains relatively stable against major currencies. The euro (EUR), Japanese yen (JPY), British pound (GBP), Swiss franc (CHF), Canadian dollar (CAD), and Australian dollar (AUD) are all trading within a narrow band of 0.12% compared to yesterday’s close. The New Zealand dollar (NZD) was the notable exception, falling 0.30%, marking the largest movement among major pairs as the dollar gained slightly.
Traders are also keeping a close eye on ongoing US trade negotiations and the stalled "big, beautiful" budget bill, both of which are expected to be addressed before the long holiday weekend.
US Jobs Data Preview
The employment report for June is due to be released today—earlier than usual because of the Fourth of July holiday tomorrow, which will also result in shortened market hours. Stock markets are scheduled to close early at 1 PM ET, with bond markets shutting at 2 PM ET.
Key forecasted figures include:
- Non-Farm Payrolls: Expected to increase by 110,000, down from a prior increase of 139,000
- Private Payrolls: Forecasted at 105,000, compared to 140,000 in May
- Manufacturing Payrolls: Predicted decline of 5,000 jobs, following a prior gain of 4,000
- Unemployment Rate: Slight uptick forecasted to 4.3%, up from 4.2%
- Average Monthly Earnings: Predicted increase of 0.3%, slightly below May’s 0.4% gain
- Average Yearly Earnings: Expected to remain steady at 3.9% year-over-year
The average workweek hours are forecasted to hold at 34.3, reflecting steady labor utilization, while other components such as labor force participation and underemployment rates are awaited.
Recent employment indicators have been mixed. The private ADP employment report surprised to the downside with a decline of 33,000 jobs, while the ISM employment component also showed softness. However, the JOLTs job openings report revealed a surprising rise, and layoffs reported by Challenger were lower, indicating ongoing labor market resilience. Initial jobless claims edged slightly higher but remain stable.
Additional Economic Data
Alongside the jobs report, other key economic data are due ahead of the weekend:
- International Trade Balance (May): Forecast at a deficit of $71.0 billion, wider than the previous $61.6 billion deficit
- Initial Jobless Claims (week ending June 28): Expected at 240,000, slightly higher than last week’s 236,000
- Canada Trade Balance (May): Expected deficit narrowed to C$5.90 billion versus prior C$7.14 billion deficit
- ISM Services Index and Factory Orders: Released at 10 AM ET, providing additional clues on economic momentum
Market Reactions and Outlook
US stock futures are trading slightly higher following record closes of the S&P 500 and NASDAQ on Wednesday. Futures indicate the Dow Jones Industrial Average could add around 36 points, the S&P could gain 1.8 points, and the NASDAQ is poised to rise approximately 6.85 points at the open.
Meanwhile, Treasury yields are inching lower across the curve, reflecting a cautious mood ahead of the data release:
- 2-year yield: 3.760%, down 2.9 basis points
- 5-year yield: 3.843%, down 2.6 basis points
- 10-year yield: 4.259%, down 3.4 basis points
- 30-year yield: 4.790%, down 3.2 basis points
Commodity markets showed mixed activity with crude oil edging down 0.19% to $67.32 per barrel but maintaining levels above key technical averages. Gold declined by 0.33% to $1,346.18 per ounce, while silver rose nearly 1% to $36.90. In the digital currency arena, Bitcoin gained $818 to reach $109,703, inching closer to its all-time high of $112,000. ### Trade Talks and Treasury Watch
US Treasury Secretary Bessent is meeting with EU officials today, emphasizing the urgency of concluding trade talks. He warned that delays could result in tariffs reverting to levels seen in early April, signaling a potential escalation in trade tensions that could affect markets.
Market Participants Await NFP for Direction
Overall, the US dollar’s pause in movement reflects market participants waiting to digest the employment data and legislative developments before committing to major moves. The report is likely to set the tone for market direction in the week ahead, especially as traders and investors adjust expectations for Federal Reserve policy and economic growth amid ongoing global uncertainties.
As the July 4 holiday approaches, markets are expected to remain cautious, with many investors choosing to take a more reserved stance until the key jobs data and budget developments become clearer.
For continued market updates and expert analysis, stay tuned to Smart Money Mindset.