Forex Today: US Dollar extends pullback as markets await key jobs data

Here is what you need to know on Friday, May 3:

The US Dollar (USD) stays under modest bearish pressure early Friday, with the USD Index (DXY) trading at its lowest level in three weeks, slightly above 105.00. In the second half of the day, the US Bureau of Labor Statistics will release April jobs report, which will include Nonfarm Payrolls, Unemployment Rate and wage inflation figures. The ISM Services PMI report for April will also be featured in the US economic docket ahead of the weekend.

After the decline seen following the Federal Reserve's (Fed) policy announcements late Wednesday, the DXY recovered modestly during the European trading hours on Thursday. The positive shift seen in risk sentiment, however, triggered another leg lower later in the American session. Wall Street's main indexes registered strong gains, with the Nasdaq Composite leading the winners with a 1.3% increase. Early Friday, US stock index futures trade in positive territory, while the 10-year US yield stays below 4.6%. 

Nonfarm Payrolls (NFP) are forecast to rise 238,000 in April following the 303,000 growth recorded in March. The Unemployment Rate is expected to hold steady at 3.8% and the Average Hourly Earnings are seen rising 4% on a yearly basis. 

NFP Forecast: Nonfarm Payrolls set for another solid increase in April, albeit cooling from March.

EUR/USD registered marginal gains on Thursday and continued to stretch higher early Friday. At the time of press, the pair was trading slightly above 1.0730.

After spending a large portion of the day below 1.2500, GBP/USD reversed its direction in the American session and closed in positive territory. The pair holds its ground in the European morning and trades modestly higher on the day near 1.2550.

Following Wednesday's sharp decline, which was seemingly caused by a Japanese intervention in the foreign exchange market, USD/JPY extended its slide in closed in negative territory on Thursday. The pair stays on the back foot early Friday and was last seen losing 0.4% on the day near 153.00.

Japanese Yen sticks to gains near near multi-week top, looks to US NFP for fresh impetus.

Gold failed to build on Wednesday's gains but managed to close the day slightly above $2,300 on Thursday. XAU/USD stays relatively quiet near this level in the European morning.

Gold price consolidates around $2,300 as traders remain on sidelines ahead of US NFP.