The US economy will be the centre of attention this week as market participants across the globe return to their desks to begin the fresh year. The US has been a bright spot in a world that is seeing stuborn inflation and economic hardship.
Tomorrow will see the latest meeting minutes from the Fed’s most recent announcement back in December. The central bank raised interest rates 0.50% following 4 consecutive moves of 0.75%. Traders and dealers will be keen to see how the Fed views 2023 from a monetary policy perspective. Indications of a ‘wait and see’ approach could knock the greenback lower as it reinforces the notion of a more dovish Fed.
On Friday, the first US non-farm payrolls report will cross the news wires. The data reflects December hiring and is forecast to see 200,000 added to the economy. This data point will set the tone for future releases this year. After solid job growth over the last 2 years, many are forecasting 2023 to be a lot more challenging. With interest rates moving higher and inflation still stubbornly elevated it would appear there are significant headwinds.
Have a good week.
Written by Viv Savani. 6:50am, January 3rd 2023
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