|

US Dollar: Labor data and confidence guide outlook – TD Securities

TD Securities strategists discuss several US indicators, expecting the June ISM Manufacturing index to edge down, while noting that JOLTS job openings remain elevated but likely overstated. They highlight cautious signals from labor market ratios and a weaker-than-expected June Consumer Confidence reading, emphasizing that labor conditions still feel difficult and projecting US payrolls to return to breakeven starting with June NFP.

Labor signals and confidence mixed

"We look for the June ISM manufacturing index to modestly reverse its May gain, falling to 53.7 (cons: 53.8). June's rapid decline in crude prices might influence responses regarding the outlook for the sector and inflation prospects."

"JOLTS job openings remained elevated for a second consecutive report, surprising expectations to the upside with a 7,594k print in May (TD: 6,900k, cons: 7,296k). We remain of the view that the JOLTS report is overstating openings, and should come back down next month given the signal from leading private sector indicators."

"Notably, consumers' assessment of the labor market resumed declining in the month. The labor differential (jobs plentiful less jobs hard to get) moved lower to 2.4 after being revised lower in May."

"While payrolls have been strong in 2026, the still-difficult nature of finding a job characterizes the strong start to the year as more stabilization rather an acceleration. We believe starting with June NFP that payrolls will move back to breakeven."

"June consumer confidence was weaker than expected, still improving, but to a lower level after downward revisions in May. The June index increased to 91.2 from 90.6 (TD: 94.0, cons: 94.4). The move higher was concentrated in expectations, probably due to consumers' hope for an Iran peace deal and lower gasoline prices."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Author

FXStreet Insights Team

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

More from FXStreet Insights Team
Share:

Editor's Picks

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10
Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.
 Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?
Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.