Yesterday's U.S. employment report was quite weak

The U.S. jobs report released on October 2, 2026 showeda weaker-than-expected result.

The most-watched nonfarm payrolls rose by
+29,000.

far below market expectations of around +90,000.

The unemployment rate also rose
from 4.1% to 4.2%.
Additionally, July and August were revised down by a total of60,000.
Source: U.S. Bureau of Labor Statistics (BLS), Reuters (October 2, 2026)

So what does this mean?

In short,

“U.S. employment is weaker than expected”

as a result.

When employment is weak, the Federal Reserve finds it harder to raise rates further.

Therefore,

weaker employment
→ lower expectations for rate hikes
→ U.S. interest rates tend to fall
→ the dollar tends to be sold

and this is the typical sequence.

In fact, after the employment data, U.S. interest rates fell and the dollar weakened.
Source: Reuters (October 2, 2026)

What about USD/JPY?

Based on this data alone,
there are downside risks for USD/JPY.

However, the FX market is not determined by the jobs data alone.

CPI and Fed communications will also be important going forward.

What about gold?

Gold generally benefits from

lower U.S. rates
＋ a weaker dollar

as a tailwind.

Therefore, this weaker employment report was
likely bullish for gold.

Summary

Yesterday’s employment report showed

job gains far below expectations and an uptick in the unemployment rate.

In the market,
the view that the Fed will delay additional rate hikes gained traction
.

Putting it simply,

it was a report that tended to be negative for the dollar and positive for gold

.