US NFP And European CPI Incoming. A Prelude To Rate Cut Bets?

Eurozone inflation and US jobs numbers will be in focus next week. In addition, the Yen and Yuan remain under surveillance for interventions, while data outside the Eurozone and China are closely watched.

Key events and Data for the week – Will US Data Take Over?

Monday – US PMI Numbers

The United States manufacturing PMI is likely to attract attention on Monday. The official manufacturing PMI is expected to rise to 48.5, a slight improvement to 47.8.

Concerns that the recovery in global manufacturing capacity is accelerating could lift sentiment earlier in the week, when volumes are expected to be light due to the long Easter holiday. weekend in many markets.

Tuesday – US JOLTS Jobs

The United States factory orders and the JOLTS job openings will be main triggers for the market. the data is foreseen at 8.79M from the previous 8.86M. the data could have a positive impact on the dollar.

Wednesday – Eurozone Inflation

 The market is closely watching eurozone inflation and labor market numbers. In February-January, monthly inflation was high for several reasons related to government measures, and service inflation was higher than expected.

 In March, Core CPI Flash Estimate y/y expected to come modestly lower by 3.0% from previous year 3.1%, while CPI Flash Estimate y/y is foreseen at 2.5% slightly lower from previous readings of 2.6%.

The Easter effect will affect the reading again, because this year the holiday comes early. This will add to inflation due to the early holidays, but should ease in May. It will not be easy for the European Central Bank to achieve all this before the April Council, but as ECB President Christine Lagarde said at the March press conference, we will know much more in June.

The United State’s ADP employment report. is the second big data of the day. The numbers are expected to be 149,000, slightly higher than the previous 140,000, and the data is expected to be slightly positive for the dollar.

Also, Federal Reserve Governor Christopher Waller was wise when he said that the United States central bank there was no rush to cut interest rates. Later, San Francisco Fed President Mary Daly and Federal Reserve Chairman Jerome Powell weighed in on the news and traders followed their comments.

Yuan and  Yen Intervention watch

Japanese and Chinese monetary authorities are on guard as their currencies weaken past levels they have defended for months, largely due to a strong dollar.

The yen is trading at $152 and the yuan is trying to break above that. On the stronger side of $7.2, authorities stepped up efforts to strengthen the currency.

In Japan that means verbal warnings, while in China state-owned banks are buying yuan and selling dollars.

Friday –  US jobs report

In Canada, employment statistics for March are the first important data. Employment change data is estimated at 37.5,000 from the previous 40.7 days. The unemployment rate is expected to rise moderately to 5.9% from 5.8% previously. which probably won’t affect the rate reduction factors much unless it’s a big miss or hit.

The Bank of Canada is another central bank that’s headed for starting its easing cycle in June. A cut became more certain after inflation fell more than expected in February, dropping below 3.0%. The labour market has also been slowing in recent months, with the jobless rate climbing to 5.8%.

Another key piece of information is the US employment report, where investors are confident the economy is in a mild recession, with inflation slowing but the economy avoiding a severe recession.

The United States economy is expected to add 205,000 jobs in March, which will slow. up from 275,000 added in February.

Expect the economy to have softened from the deepening recession as the Fed stuck to its stance at its March meeting on three interest rate hikes this year, while improving its growth outlook.

US job growth continued steady as nonfarm payrolls rose by 275,000. The March forecast showed the economy adding 198,000 new jobs and the unemployment rate holding steady at 3.9 percent, while average hourly wage growth slowed to 4.1 percent from a year earlier.

Commodity Samachar
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