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What role do employment reports play in forex trading?

Employment reflects economic health and directly impacts monetary policy. In the U.S., Non-Farm Payrolls (NFP) is the most-watched report globally, often moving markets instantly. A strong jobs report suggests a robust economy, supporting currency strength, while weak data signals recession risks. Institutions trade NFP with advanced algorithms, while retail traders should approach carefully due to volatility. Benefits: employment is a leading indicator for growth and inflation. Risks: extreme whipsaws make news trading dangerous without discipline. Employment data reminds traders that behind charts are people—jobs drive spending, growth, and ultimately, currency demand.