Positive NFP figures are good for the economy, so investors will buy US dollars in anticipation of a stronger economy in the future. When the NFP is worse than expected, the US dollar falls as investors sell their US dollars.
Sometimes you'll notice negative effects that don't make sense at first. This is especially true when the data released surprises traders. The old adage "you don't trade the news, you trade how people interpret the news" applies a lot to NFP forex trading.

Non-Farm Payroll (NFP) data is one of the most influential economic indicators affecting the US dollar. Released monthly, it measures the number of jobs added or lost in the US economy, excluding farm, government, and household workers. Strong NFP figures signal economic growth, often strengthening the US dollar as investors anticipate higher interest rates or tighter monetary policy from the Federal Reserve. Conversely, weak NFP data suggests economic slowdown, which can weaken the dollar due to expectations of rate cuts or continued stimulus. NFP reports also influence market volatility, especially in forex, stocks, and bonds, as traders react quickly to employment trends. Because employment is closely tied to consumer spending and inflation, NFP data plays a key role in shaping confidence in the US economy and short-term movements of the US dollar.