The recent firing of Erika McEntarfer from the U.S. Bureau of Labor Statistics (BLS) has changed how we look at non-farm payroll data. There is growing doubt about data accuracy, especially if the report shows a +250K increase along with falling unemployment. For this month’s payrolls, experts expect an increase of +75K, with unemployment rising slightly to 4.3% from 4.2%. Last month’s report showed non-farm payrolls at +22K, which was much lower than the expected +75K.

Impact on Currency Markets

In this context, the EUR/USD currency pair has fallen after former President Trump suggested implementing a 15–20% minimum tariff on all EU products. In Canada, employment decreased by -65.5K, compared to an expected increase of +10K. Foreign exchange trading comes with risks that may not suit everyone. Leverage can increase potential risks, leading to greater losses. It’s crucial to understand these risks, take personal investment goals into account, and seek independent advice if necessary. InvestingLive offers information for educational purposes and is not liable for any losses resulting from reliance on its content. Advertisers on the site may pay InvestingLive based on how users interact. Following the surprising August non-farm payroll number of +22K, we must consider that official government data may not be reliable. The firing of the BLS chief last month adds a political angle that shouldn’t be overlooked. This situation is likely to drive implied volatility up in the coming weeks, making it hard for the market to accurately reflect economic conditions. This morning, the CBOE Volatility Index (VIX) jumped over 20%, reaching 21.5—levels we haven’t seen since the debt ceiling debates of early 2025. Traders might want to buy options to protect against this volatility, such as out-of-the-money puts on major indices or using straddles to capitalize on the likelihood of sharp market changes around upcoming data releases. These strategies focus on profiting from volatility rather than predicting market direction.

Alternative Data Points

Now, we should pay more attention to alternative data sources that are less affected by political influences. For example, the August ADP private payroll report indicated a much stronger gain of +175,000 jobs, while weekly jobless claims have remained consistently below 230,000 for several months. This difference suggests that the labor market might actually be healthier than indicated by the official NFP report, which we should consider when trading. This situation reminds us of the significant benchmark revisions back in 2023, when the BLS adjusted past job estimates upwards by hundreds of thousands. Initial reports during that time caused major market fluctuations, only for the data to be quietly revised later. In today’s environment, we should assume that any unexpectedly weak or strong numbers could be subject to large future revisions, posing traps for those betting solely on direction. The U.S. dollar is in a challenging spot, weakening due to poor jobs data while also receiving support from renewed political discussions about tariffs on European products. This conflicting situation makes trading currency pairs like EUR/USD particularly risky for spot traders. It’s wiser to consider derivative strategies, like purchasing currency options, which help manage risk rather than holding direct positions. Create your live VT Markets account and start trading now.

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