We have seen a new record high in US stocks thanks to a largely positive US non-farm payrolls report. The update showed that 850,000 new jobs were added, easily topping the 700,000 consensus estimate, it was also confirmed the pervious report was revised higher to 583,000, up from 559,000. Average earnings on a yearly basis were 3.6%, which was a big increase on the 2% posted in May. Not all aspects of the report were positive, as the unemployment rate unexpectedly increased from 5.8% to 5.9%. Overall, it was a solid jobs report, and it underlines the robust rebound in US. At the latest Federal Reserve meeting, the bank signalled there could be two rate hikes in 2023. Considering the unemployment rate ticked up, it seems the body will not bring forward their plans to tighten monetary policy. The S&P 500 and the NASDAQ 100 have racked up fresh record highs as traders welcomed the data. The situation in Europe is a little less optimistic as some of the major indices are showing small losses.
Ahead of the US jobs report, the dollar hit is highest mark since early April. Traders clearly had high hopes going into the announcement. Even though the data was pretty good, the greenback slipped in the wake of the news. It is possible the worse-than-expected unemployment reading prompted the bulls to re-consider their outlook. The dollar may have slipped a little, but nonetheless today’s labour market update added weight to the view country is still turning around. In the past few hours, we have seen AUD/USD, GBP/USD and EUR/USD rebound but let us not forget that the Fed appears to be further down the line with respect to hiking rates than the other central banks.
Gold briefly hit a two-week high as the slide in the dollar assisted the metal. Since Tuesday, the commodity has been rebounding, it is a promising sign, but it ran out of steam as it neared the $1,800 mark. Lately, gold has been a victim of the stronger US dollar. Silver enjoyed a rally too. Industrial metals like palladium and copper have been trading in a small range, the rising number of new Covid-19 cases has slightly put the brakes on the global growth story. Oil is offside as OPEC+ couldn’t decide upon a course of action with respect to the size of the next increase in output, the disagreement prompted some dealers to sell WTI and Brent Crude.