by Jonny Harris
May’s Non-farm payrolls figures were incredibly disappointing coming in at 38k. Today we expect to see a slightly stronger reading of 180k. Yesterday’s ADPreport showed a rise in the private sector employment to 172k which normally sets up a relatively good release in the non-farms. If they come out as expected, we are more than likely going to see the dollar gain significantly throughout the course of the day and over the weekend.
The UK release the external trade date an Q1 unit labour costs, which are both unlikely to gain too much market attention. Next weeks Bank of England monetary policy decision will spark significant interest as he has mentioned if we don’t see a rate cut this month, we will do next. A OIS Curve on Bloomberg suggests that markets are already pricing in a 74% chance of a quarter-point rate cut to 0.25% and 26% chance of no change. An article in the newspaper yesterday said that we could see GBPUSD at parity if we see a rate cut in the UK.
German figures fall for a third day as exports and imports fall.
Morning Market Rates