Friday’s US jobs data revealed a strong economy still creating new jobs at pace, lowering fears that the US may enter a mild recession.
- Friday’s US Non-Farm Payrolls data showed that the American economy still has plenty of steam, with 253k new jobs created last month, far outstripping the expected 181k and the previous month’s 165k. Average Hourly Earnings also rose by considerably more than expected, showing a 0.5% increase on the previous month when only 0.3% had been expected. The data supports the case that the US will avoid a recession later this year but may also be interpreted later as increasing the chance of another 25bps rate hike by the Fed at its next policy meeting. So far, the data seems to be interpreted as validating the risk-on case, as we see risky assets mostly rising in value.
- Stock markets are mostly bullish, although the Nikkei 225 Index has been selling off from its long-term high reached at the end of last week.
- In the Forex market, the US Dollar is falling again in line with its long-term bearish trend. The Australian Dollar is showing the greatest short-term strength while the US Dollar is clearly the weakest currency, putting the AUD/USD currency pair in focus. The long-term bearish trend in the US Dollar remains valid, and trend traders may also be looking for long trades in the EUR/USD and GBP/USD currency pairs, both of which are currently testing long-term highs.
- Precious metals are performing strongly after Gold reached a high price just below its all-time high of $2,070 last week.
- Some soft commodities have been breaking to new highs and trending strongly, notably the Sugar ETF Cane which ended the week with a strong rebound, and the Cocoa ETF NIB..
- It is a public holiday today in the UK and France.