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Spains unadjusted industrial production rose 2.1% year-on-year in March, compared with a previous reading of -1.30%.Spains seasonally adjusted industrial production rose 1.8% year-on-year in March, revised from -1.10% to -0.9% in the previous month.May 8th - According to the National Development and Reform Commission (NDRC), the domestic refined oil price adjustment window will open at 24:00 on May 8th. According to the NDRC Price Monitoring Center, during this round of refined oil price adjustment cycle (24:00 on April 21st to 24:00 on May 8th), international oil prices initially rose and then fell. Starting at 24:00 on May 8th, domestic gasoline and diesel prices will increase by 320 yuan and 310 yuan per ton respectively. On average nationwide, the price of 92-octane gasoline, 95-octane gasoline, and 0-grade diesel will increase by 0.25 yuan, 0.27 yuan, and 0.27 yuan per liter respectively. Filling a 50-liter tank with 92-octane gasoline will cost an extra 12.5 yuan.Switzerlands consumer confidence index for April will be released in ten minutes.May 8th - Rising oil prices have made inflation a more pressing concern for the Federal Reserve recently. However, the employment-related aspect of its dual mandate is also worth noting, given the recent volatility in non-farm payroll reports. Therefore, the April jobs report is a crucial economic indicator to watch closely. For example, the U.S. added 160,000 jobs in January, but lost 133,000 in February. March saw a rebound with 178,000 new jobs. Overall, the U.S. is projected to add 205,000 jobs by March 2026, averaging 68,000 per month. David Payne, economist and journalist at The Kiplinger Letter, stated, "These figures suggest that despite slow labor force growth, U.S. job growth remains strong."

EUR/USD falls toward 1.0500 as the US labor market tightens and investors investigate Eurozone inflation

Daniel Rogers

Jan 06, 2023 11:19

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In the early Tokyo session, the EUR/USD pair is hanging at the critical support level of 1.0520. The major currency pair is projected to prolong its slide to around the psychological support of 1.0500, as the United States' tight job market has spurred the threat of the Federal Reserve (Fed) sustaining rising interest rates beyond CY2023.

 

Investors applied heavy selling pressure on risk-perceived assets such as the S&P 500 as the better-than-anticipated addition of new payrolls to the U.S. labor market for the month of December could accelerate wage inflation in the future. Risk aversion was encouraged by investors, resulting in a jump in the US Dollar Index (DXY). The USD Index jumped to roughly 105.00 due to a boost in safe-haven demand. A reduction in investors' risk appetite affected the demand for United States government bonds.

 

The Automatic Data Processing (ADP) agency of the United States declared a large increase in the number of employment additions for the month of December, from 150K to 235K, compared to the previous release of 127K. It is abundantly evident that increasing demands for skill will be satisfied by paying higher remuneration, therefore stimulating wage growth and leaving individuals with more spare cash. The declaration could bring about a price index recovery through a spike in retail demand.

 

In the future, the United States Nonfarm Payrolls (NFP) statistics release will give further information on the employment situation. The Unemployment Rate is anticipated to continue at 3.7%. In addition, the disclosure of the facts regarding the Average Hourly Wage will be of the utmost importance.

 

Investors will eagerly scrutinize the release of the Eurozone Harmonized Index of Consumer Prices (HICP) numbers on Friday. In view of the fall in energy prices and German inflation, it is quite possible that Eurozone inflationary pressures will follow a similar trend.

 

As reported by Reuters, European Central Bank (ECB) policymaker Francois Villeroy de Galhau noted in a New Year's address: "It would be desirable to achieve the appropriate 'terminal rate' by the summer of next year, but it is too early to say at what level."


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