Traders braced for latest US jobs report
Important data released today is expected to reveal that 190,000 new jobs were added to the US economy in May, with the unemployment rate holding steady at 3.9%.
The nonfarm payrolls figure, released every month, tends to create volatility in the markets and is therefore closely watched by financial traders.
If May’s figures come out in line with the current expectations it would paint a picture of a fairly robust US economy and will therefore cement expectations of a US interest rate hike later in June (currently priced in at 85% by the market).
A stronger reading will rekindle talk of the need for two more rate hikes by the Federal Reserve, which would likely boost an already strong dollar. News of US metal tariffs and Spanish political turmoil is adding to the negative sentiment for EUR/USD. GBP/USD also remains in a firmly bearish trend, while the strong dollar is keeping gold penned in around $1300 an ounce. All of these instruments, and more, are likely to be impacted by Friday’s data.
‘The NFP figure comes at the start of the month, setting us up for much speculation on the state of the US economy and the knock-on potential for further rate hikes,’ explains InterTrader’s Chief Market Strategist Steve Ruffley, who is hosting a live webinar covering the crucial US NFP release.
‘As always with such a historically tough number to predict, any discrepancies will lead to potential big moves in the forex markets,’ says Steve. ‘The main markets I will covering will be the GBP/USD, USD/JPY and gold.’