Impression of a structural advantage of the US labor market over the Euro Area is unjustified – Commerzbank

The Dollar was able to make significant gains on Friday following the release of the US labor market report. Economists at Commerzbank analyze how much better is the US labor market.

So far, everything is as USD-positive  – or EUR-USD-negative – as it can be

So far, everything is as USD-positive (or EUR/USD-negative) as it can be. But I would caution against throwing the baby out with the bathwater.

I have written a lot recently about whether the US could have a sustainable growth advantage over the Eurozone. If so, that would justify a strong Dollar, regardless of the outlook for Fed and ECB monetary policy. I believe that such an assumption is warranted, given GDP developments. However, I do not think that the impression of a structural advantage of the US labor market over the labor market here in the Euro Area is justified.