Here is what you need to know on Friday, May 7:
The market mood is upbeat despite Fed warnings about financial risks and ongoing US-China tensions. Nonfarm Payrolls are set to show an increase of around one million jobs.
The Federal Reserve warned that covid still poses a major financial risk and that prices are vulnerable to significant declines. Stocks advance on Thursday as most Fed officials continued saying the US economy has a long way to go. Robert Kaplan, President of the Dallas Fed, stood out by urging a discussion about tapering bond-buying.
The US dollar has been edging lower as 10-year Treasury yields remain in low ground under 1.60%. Supply chain strains and skills shortage issues are pushing prices higher but also cooling the economy.
President Joe Biden is set to maintain bans on Chinese investment slapped by the previous administration, adding to tensions. In the meantime, Beijing reported better-than-expected increases in both imports and exports in April.
Nonfarm Payrolls: The US is expected to report an increase of 978,000 jobs in April, topping March's 916,000 increase. Economists expect the Unemployment Rate to drop from 6% to 5.8% and earnings are projected to drop. Uncertainty about such robust hiring implies surprises are due, with some expecting 1.3 million positions gained. As of March, some 8.4 million Americans that lost their jobs in the pandemic are still out of work.
US Nonfarm Payrolls April Preview: When the economy booms, its all about rates
Canada also publishes its labor figures on Friday, and the economic calendar is pointing to a loss of 175,000 jobs, accompanied by an increase in the jobless rate to 7.8%. Low estimates come despite the broad recovery. USD/CAD is trading below 1.22 ahead of the release.
Canadian Jobs Preview: US demand likely to outweigh covid concerns, push hiring, CAD higher
UK local elections: Investors are still waiting for the results of elections in Scotland, where pro-independence parties could clinch a majority, reopening the topic. Elsewhere, voters seemed to back Prime Minister Boris Johnson's Conservative Party.
The Bank of England announced it is slowing down the pace of bond purchases but left the total unchanged. The pound traded choppily before stabilizing around 1.39.
Cryptocurrencies: Bitcoin is trading below $55,000, Ethereum around $3,4000 and XRP below $1.60 as digital assets are off their highs.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD keeps range near 1.0650 ahead of German IFO survey
EUR/USD is keeping its range play intact near 1.0650 in the early European hours on Monday. Markets stay risk-averse, weighing the Fed's 'higher-for-longer' rate view and lingering China's property market woes. Germany's IFO survey eyed.
GBP/USD remains on the defensive below the 1.2250
GBP/USD remains on the defensive below the mid-1.2200s early Monday. The US Dollar is clinging to the previous week's gains alongside firmer US Treasury bond yields while the Pound Sterling weighs the Fed-BoE policy divergence amid a quiet calendar.
Gold remains stuck below key averages, what’s next?
Gold price is easing toward $1,920, making it for a negative start to a key week ahead. The United States Dollar (USD) and the US Treasury bond yields have entered a phase of consolidation near last week’s high, as investors look to this week’s inflation data from the US and Europe for a fresh directional impetus.
Ethereum whales prepare ahead of futures Ethereum ETF approval on October 2
Ethereum price is likely going to witness a massive spike in volatility soon due to the circumstances surrounding the approval of the token’s futures Exchange-Traded Fund (ETF). According to Twitter users, the ETF is likely going to be approved on October 2.
Is inflation falling further?
A first flash estimate of Eurozone inflation in September is expected. In August, inflation fell slightly to 5.2%. While the downward pressure from energy prices has eased slightly, the momentum of food prices has continued to decline.