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Forex pairs in this Article » USD/JPY (London) - USD/JPY fell sharply before a rebound after US non-farm payrolls saw a big miss on expectations, printing at just 74k against consensus expectations around 197k. The print is a sharp drop on November numbers, which added 241k jobs. Although the headline unemployment rate dropped from 7.0 to 6.7 percent, this can be attributed to a decline in participation rate falling to its lowest levels in 36 years

After buoyant optimism running up to the release of the non-farms numbers thanks to solid ADP data earlier this week as well as generally upbeat US macro outlooks, the shortfall in expectations will trigger some sharp drops in USD.

January taper in doubt

The sharp fall in the headline NFP number will increase the speculation surrounding the next meeting concluding on January 29. The Fed moved to cut the size of its monthly asset purchases at its last meeting in December down USD10bn to USD75bn. The first round of tapering was carried out citing an improved US economic outlook. However, the NFP miss may postpone further tapering.

USD/JPY bounces off lows

USD/JPY has recovered some ground from its drop to JPY104.192 immediately following the jobs number and is currently trading at JPY104.5280, down 0.3 percent on the session
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