EURUSD is moving in descending channel and the market has rebounded from the lower low area of the channel.
The US is all set to release its non-farm payroll numbers. Analysts are expecting it to come out lower than expected. Here is all you need to know:
US Job Growth
Companies in the United States added more jobs than analysts anticipated in February, highlighting the sustained need for workers that is keeping pay growth robust. According to new numbers that were released on Wednesday by the ADP Research Institute in partnership with the Stanford Digital Economy Lab, private payrolls increased by 242,000 in February, following an increase of 119,000 that was revised upwards in January.
Later this week, the United States Bureau of Labor Statistics will, as part of its Employment Situation Report, disclose statistics on the employment growth that occurred in February 2023. With its Job Openings and Labor Turnover survey, it will also provide information on job vacancies, hiring, and separations during the month of January 2023. As new economic data are released, and the U.S. labor market continues to recover from the COVID-19 recession, one important underlying dynamic that economists and policymakers alike need to pay attention to is the relationship between employment growth, job switching, and wage disparities in the U.S. labor market. This is because the relationship between these three factors is directly related to the wage disparities that exist in the U.S. labor market.
XAUUSD is moving in descending channel and the market has reached the lower high area of the channel.
The primary economic indicators suggest that the job market in the United States is in an exceptionally healthy state. The economy of the United States has added an average of 356,000 jobs each month during the past three months. With its current level of 3.4 percent, the unemployment rate in the United States is at its lowest point in half a century. Nearly all of the major industries have achieved employment levels that are higher than they were before the epidemic. Yet the rate of people quitting their jobs remains close to record highs, which is an indication that employees in the United States feel optimistic about the labor market and their ability to find new and better employment prospects.
These significant upward trends are being driven by a number of important factors that are sculpting the recovery from the brief but profound COVID-19 recession that occurred in 2020.
USDJPY is moving in a ascending channel and the market has rebounded from the higher low area of the channel
One of these is the increase in real wages that workers at the lowest end of the pay distribution have seen. One more is the high rate of resignations among these individuals and workers in general in the United States. And yet another change is the constructive link that exists between these two different dynamics.
Feds Barr Speech
Feds Vice Chairman Michael Barr recently gave a speech regarding how the Feds are approaching the regulation of bank-related crypto activities. He reveals, “When I think about how to approach crypto-assets, the technology behind them, and the interaction between the crypto sector and traditional financial system, I find it helpful to place recent innovation in historical context. Innovation in financial markets has long raised questions about the appropriate role of regulation. Of particular concern is how the regulatory framework can serve both to encourage innovation and to support the safety and soundness of financial institutions and broader financial stability. Just as important is the need to protect the public from fraud and other abusive behavior.”
USDCAD is moving in a ascending channel and the market has reached the higher high area of the channel.
“The challenge here begins with a mismatch in timing. Innovation often comes quickly, but it takes time for consumers to become aware that they could both gain and lose money on new financial products. It may take time for market participants to understand attendant risks and come up with tools to manage them.
Likewise, regulation involves a deliberative process—as it should because it needs to balance the risk that over-regulation will stifle innovation with the risk that under-regulation will allow for substantial harm to households and the financial system. Today, while the crypto-asset sector is more nascent and less pervasive, the questions about how new financial products will affect the public, the economy, and financial stability are similar. Innovation surges ahead, and regulation follows, trying to balance benefits and risks.”
US Retail Sales
After falling for two months in a row, retail sales in the United States had their largest monthly rise in almost two years in the month of January. This was due to a rise in the number of motor cars and other commodities that were purchased by Americans, which indicates to the sustained resilience of the economy despite the increase in the cost of borrowing money.
USDCHF is moving in descending channel and the market has reached the lower high area of the channel.
Signs of strength in consumer spending could fuel speculation in the financial market that the United States Federal Reserve may continue raising interest rates through the summer to cool domestic demand. This would be in response to the fact that there are signs that consumer spending is strengthening. The previous day, on Tuesday, it was reported that the annual rate of inflation climbed higher in January. This piece of information comes right on the heels of that report.
It was determined that customers started their Christmas shopping early, which resulted in a decline in sales that happened over the two months before to that. Economists have asserted that the methodology that the government utilizes in order to eliminate seasonal variances from the data does not take into consideration the front-loading of holiday shopping to the level that it should have.
The purchase of motor vehicles was the primary driver behind the significant increase in retail sales that was observed during the previous month. As a consequence of this, revenues at auto dealers increased by 5.9 percent. The number of transactions that took place at service stations stayed the same even if the price of gasoline and/or fuel was up.
During the months of May and December, the vast bulk of these increases was seen. It is projected that there will be two further rate hikes, each of which will be 25 basis points, in the months of March and May, respectively. Consumer expenditure is the component of the gross domestic product that has the most direct correlation with core retail sales, and it is also the component that has the highest absolute value.
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