USD weakens as soft US jobs data signals potential Fed rate cuts in 2025

The US dollar has come under pressure following disappointing November employment data, with major USD pairs showing weakness across the board. Non-farm payrolls rose by only 64k in November, significantly below expectations, while October's figure was revised sharply lower to show a decline of 105k jobs. The three-month average job growth has cooled dramatically to just 22k, indicating persistent labor market softness. Additionally, the unemployment rate edged higher to 4.6%, reinforcing concerns about economic momentum. CIBC analysts suggest this deteriorating employment picture could prompt the Federal Reserve to reconsider its monetary policy stance and potentially shift toward earlier rate cuts in 2025. For USD pairs, this development represents a significant bearish catalyst, with EURUSD likely to test resistance above 1.0900 and GBPUSD eyeing the 1.2800 level. Traders should monitor upcoming Fed communications for any shifts in policy guidance.