Mixed News Again From the Global Economy

Wells Fargo Research Team Wells Fargo

U.S. Review

Looking for Further Improvement in the Labor Market

Minutes from the September FOMC meeting showed the committee was close to raising rates, but was awaiting some additional gains in the labor market. The job opening rate fell in August to an eight-month low, but the less volatile turnover measures showed little change. Hirings and involuntary separations fell slightly, while quits were up a bit.
Retail sales for September rose 0.6 percent, in line with expectations, but core sales, measured by the control group, disappointed by rising only 0.1 percent.
Measures of import prices and producer prices released this week point to a modest pickup in inflation.

Global Review

Mixed News Again From the Global Economy

Markets reacted negatively to the news that Chinese exports dropped 5.6 percent in September on a year-earlier basis in local currency terms (they dropped 10 percent in U.S. dollar terms) as markets were expecting exports to have grown 2.5 percent. The expectation is that, as the third quarter earnings release season starts, this weakness from Chinese exports is going to tarnish companies’ earnings at a time when the U.S. dollar has appreciated.
Perhaps the biggest concern for markets today is that the more coincident data are pointing to weakness after some relatively stronger months during the last part of the second quarter and the first month of the third quarter.

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Wells Fargo Research Team

Wells Fargo

EUR/USD holds firm above 1.1900 as US NFP looms

EUR/USD holds its upbeat momentum above 1.1900 in the European trading hours on Wednesday, helped by a broadly weaker US Dollar. Markets could turn cautious later in the day as the delayed US employment report for January will takes center stage.

GBP/USD recovers losses despite rising UK political risks, BoE rate cut bets

Pound Sterling advances against the US Dollar after registering modest losses in the previous session, trading around 1.3650 during the Asian hours on Wednesday. The pair could extend losses as the Pound Sterling faces pressure from rising political risks in the UK and growing expectations of near-term Bank of England rate cuts.

Gold sticks to gains near $5,050 as focus shifts to US NFP

Gold holds moderate gains near the $5,050 level in the European session on Wednesday, reversing a part of the previous day's modest losses amid dovish US Federal Reserve-inspired US Dollar weakness. This, in turn, is seen as a key factor acting as a tailwind for the non-yielding yellow metal ahead of the critical US NFP release.

Bitcoin, Ethereum and Ripple show no sign of recovery

Bitcoin, Ethereum, and Ripple show signs of cautious stabilization on Wednesday after failing to close above their key resistance levels earlier this week. BTC trades below $69,000, while ETH and XRP also encountered rejection near major resistance levels. With no immediate bullish catalyst, the top three cryptocurrencies continue to show no clear signs of a sustained recovery.

Dollar drops and stocks rally: The week of reckoning for US economic data

Following a sizeable move lower in US technology Stocks last week, we have witnessed a meaningful recovery unfold. The USD Index is in a concerning position; the monthly price continues to hold the south channel support.

BNB prolonged correction signals deeper bearish momentum

BNB (BNB), formerly known as Binance Coin, is trading below $618 on Wednesday, marking the sixth consecutive day of correction since the weekend. The bearish price action is further supported by rising short bets alongside negative funding rates in the derivatives market.