NFP Friday

Daily Analysis - 01/06/2018

End of a busy week, new month, new NFP report


It’s been a busy week in terms of news and we saw quite a bit of volatility in the markets. Italy has finally ended the week with a government – a populist coalition. Trade wars fears are back after President Trump announced on Thursday that the U.S will impose tariffs on Canada, Mexico and E.U.  The market’s focus will be on the U.S. employment report later today.

Trade Tariffs weigh loonie and peso

The steel and aluminium tariffs on imports from Canada, Mexico and the E.U. into the U.S. led to weakness in the loonie and the Mexican peso particularly, not so much the euro. In reaction to the news on Thursday, USD/CAD jumped to 1.2990 erasing losses made earlier this week. USD/MXN rose to 20.04, the highest since February 2017. U.S. steel and aluminium companies benefitted from the news, with their stock prices rising on the news.


Euro steadies on Italy news

The euro is steady against the dollar today, still trading in the $1.16 handle, after making relief rally yesterday as Italy finally has a government. The two populist parties finally agreed to form a coalition government and agreed not to appoint Eurosceptic economy minister Paolo Savona.


Sentiment good for NFP

USD/JPY is rising ahead of today’s all important U.S. jobs report. The data for May is expected to show 189k jobs created versus 164k in the previous month. Average hourly earnings will be closely watched and this is also expected to rise 0.2% month-on-month versus 0.1% in the prior month.


Upcoming Events

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  • 08:30 GMT
  • GBP
  • Manufacturing PMI (May)
  • 53.5
  • 53.9
  • 12:30 GMT
  • USD
  • Nonfarm Payrolls (May)
  • 189K
  • 164K
  • 12:30 GMT
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  • Unemployment rate (May)
  • 3.90%
  • 3.90%
  • 14:00 GMT
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  • ISM Manufacturing PMI (May)
  • 58.2
  • 57.3

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