After initially heading a little lower on Friday following the release of the US employment data, the dollar ended the day on a solid note, partly driven be recovering Treasury yields but with traders also now looking forward to the December FOMC meeting at which a rate hike is generally expected. The headline job growth, as shown in the Non-Farm Payrolls report was at 261k in October. This was below the expectation of 310k but the previous month’s figure was revised up from -33k contraction to +18k, pretty much negating Friday’s miss. The headline unemployment rate dropped to 4.1%, below expectation of being unchanged at 4.2%. In other markets, the S+P and DJI both made another new all-time high, closing nearby and underpinned by the big tech stocks, in what was a fairly steady stock market, while the metals were heavy, under pressure from the firmer dollar. WTI was firmer, at a 2 year high after a late-session surge on the back of data showing signs of US production tightening, with the Baker Hughes Oil Rig Count falling to a nearly six-month low.
The coming week will have plenty going on although very little to be seen from the US, with the week ending with the Veterans Day holiday. Ahead of that, the important focus will be on the Markit Manufacturing/Services/Composite PMIs and speeches from Yellen/Dudley (Monday), the RBA Meeting (Tuesday), China Trade Balance (Wed), RBNZ Meeting and China CPI (Thur) and the UK Manufacturing/Industrial Production (Fri). Have a good week.
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