By Hassan Fawaz, Chairman & Founder of GivTrade

The US dollar weakened on Monday, extending losses into a second consecutive session ahead of key economic data this week. Attention could remain focused on the January US employment report, scheduled for release on Wednesday. Consensus expectations point to a modest rebound in job creation, with nonfarm payrolls anticipated at around 70,000 after December’s subdued 50,000 increase, while the unemployment rate is forecast to remain unchanged at 4.4%.

Given recent signals of a cooling job market, any meaningful deviation from expectations could trigger sharp moves across both forex and bond markets. A softer-than-expected print would likely revive concerns about labor market momentum, reinforcing expectations of monetary policy easing later in the year and weighing on the dollar. However, a stronger outcome could challenge that narrative and support the currency and bolster yields.

In the absence of major data releases today, investor focus shifts to speeches from Federal Reserve officials. Markets will be listening closely for confirmation of the cautious tone adopted in recent weeks. If policymakers continue to emphasize patience, expectations for interest rate cuts could decline, offering some near-term support to the dollar.