At a virtual event held by the Council for Economic Education, Cleveland Federal Reserve Bank President Loretta Mester explained that she believes that the US Unemployment Rate will likely rise a little but she said "we have to be singularly focused on inflation."

"If we want to get back to healthy conditions, this is something we have to do."

Key comments

• I don't think we can count on a big surge in labour force participation.
• We have to be singularly focused on inflation.
• Getting inflation down is job one.
• I see more persistence in inflation and see rates rising higher than the median of Fed policymakers.
• We have more work to do to get inflation on 2% path.
• I have not seen any evidence that markets aren't working in the US.
• As the Fed raises rates, that won't stop the central bank from pursuing "job one" of fighting inflation.
• We will not be cutting rates next year at all.
• Fed will use its tools to get to inflation target, don't need fiscal policy to tighten to make that happen.

US dollar update

The DXY index, which measures the US dollar vs a basket of currencies rose on Thursday and extended its gains from the previous day. The index is back above 112.00, recovering from when it was initially falling against most majors at the start of the week before regaining ground.

If it is going to extend the gains towards the high of the week through 112.50, the Nonfarm Payrolls will need to shape up. If Friday's NFP is terrible, then the 111 level will potentially come under pressure as investors will be looking for a Fed pivot.