US nonfarm payrolls posted a paltry gain, pointing to a slow recovery for the world’s largest economy. With the resurgence in Covid-19, economic conditions across the major economies are difficult. This week’s focus is on inflation in the US and Germany, and GDP in the UK.
Eurozone inflation was unexpectedly strong in January. Headline inflation rose to 0.9% while core CPI improved to 1.4%. German Factory Orders fell by 1.9%, its first decline in eight months.
Strong UK employment numbers gave sterling a slight boost early last week. Wage growth jumped to 3.6%, up sharply from 2.7%. Unemployment rolls rose by just 7 thousand, well below the estimate of 47.5 thousand. The unemployment rate nudged up from 4.9% to 5.0%, its highest level since March 2016.
The Bank of England maintained interest rate and QE levels at its policy meeting. BoE Governor Bailey assured the markets that the BoE was not signaling that it planned to introduce negative interest rates, although the BoE did tell banks to be prepared for such a scenario.
U.S. Nonfarm Payrolls disappointed with a negligible gain of 49 thousand, which didn’t even reach the forecast of 85 thousand. Wage growth rose 0.2%, down from 0.8% beforehand. There was better news from the unemployment rate, which dropped from 6.7% to 6.3%, its lowest level since March.
In Canada, January’s employment numbers were dismal. The economy shed some 212.8 thousand jobs, a second straight decline and much weaker than the estimate of -43.5 thousand. The unemployment rate jumped from 8.6% to 9.4%, its highest level in five months. This missed the forecast of 8.9%.
U.S. Nonfarm Payrolls disappointed with a negligible gain of 49 thousand, which didn’t even reach the forecast of 85 thousand. Wage growth rose 0.2%, down from 0.8% beforehand. There was better news from the unemployment rate, which dropped from 6.7% to 6.3%, its lowest level since March.
- German Final CPI: Wednesday, 7:00. Inflation has struggled but improved in December with a solid gain of 0.5%. The upward trend is expected to continue, with a street consensus of 0.8%.
- US CPI: Wednesday, 13:30. The financial markets are paying closer attention to inflation, which is showing signs of resurgence. Headline inflation rose to 0.4% in December and an identical gain is expected for January.
- UK Prelim GDP: Friday, 7:00. After the huge swings in GFP in the past two quarters, GDP is expected to show a negligible gain of 0.5%. An unexpected reading could affect the movement of GBP/USD.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Recommended Content
Editors’ Picks
EUR/USD trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair keenly awaits the US PCE inflation data and Fed Chair Powell's speech for fresh hints on next week's price action.
GBP/USD holds steady above 1.2600 as markets stay calm on Good Friday
GBP/USD trades sideways above 1.2600 amid a typical Good Friday trading lull. A broadly firmer US Dollar could keep any upside attempts limited in the pair ahead of the US PCE inflation data and Fed Chair Powell's appearance.
Gold price sits at all-time highs above $2,230, US PCE eyed
Gold price hit all-time highs at $2,236 on Thursday to finish Q1 2024 with a bang. Most major world markets, including the US are closed due to Holy Friday, leaving volatility around Gold price highly subdued. US PCE inflation and Powell are awaited.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.