As participants in the UK return to their desks following an extended bank holiday weekend, they will begin to focus on the next major risk event for financial markets. This is the August US non-farm payrolls report which is scheduled for release on Friday.
Since March, the Fed has hiked rates by 2.25% with the August jobs report set to influence how aggressive their September move is. Job gains have been impressive this year with the July report printing at 528,000. August is set to produce another 285K which would likely support another 75-basis point rate rise from the Fed.
Also on the agenda this week, eurozone inflation data for August is released. This comes after media reports yesterday that the European Central Bank may opt for a significant 0.75% increase next month. This took markets by surprise and helped the euro find fresh buyers. EURUSD rose above parity while the GBPEUR cross rate fell to €1.17.
Have a good week.
Written by Viv Savani. 8:30am, August 30th 2022
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