Following on from an interesting week which saw a solid US non-farm payrolls release, this one is set to ensure volatility remains across foreign exchange markets.
Last week’s non-farm payrolls report impressed despite the disruption created by the 35-day government shutdown. The headline number smashed expectation but this was covered by a revision lower to December’s number. The jobless rate ticked a little higher with average hourly earnings a shade softer. Regardless of these last 2 metrics, the report manages to prove a well maintained labour market on the verge of full-employment. The greenback managed to gain some ground as a result, pushing toward support at $1.3050 and $1.14 against the pound and euro, respectively.
This week holds a number of important data releases but the two highlights won’t be in report format. Firstly, Trump will give his State of the Union address on Tuesday just as he begins his next 2 years of the Presidency. The US & China are racing ahead to achieve a trade deal by the 2nd of March, any insight into progress on this matter could spur the next move in financial markets and the greenback in particular. Secondly, the Bank of England will hold a monetary policy announcement on Thursday. The central bank are not expected to amend policy in any way but their inflation and growth forecasts will be closely watched.
Written by Viv Savani. 9:27am, February 4th 2019
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