Support
Markets await NFP amid mixed labor signals
December Nonfarm Payrolls are expected to show a 220,000 increase, well above November’s 160,000
China's December PPI and CPI data hinted at easing deflation
Germany's industrial production and trade balance outpaced expectations
Gold prices faced headwinds from a strong US dollar
US Markets
Yesterday's The Federal Reserve's December minutes offered no major revelations, reinforcing a measured approach amidst persistent inflationary pressures.
Labor market data painted a mixed picture. ADP employment figures underperformed with a 120,000 rise, falling short of the 140,000 forecast. However, jobless claims showed resilience, dropping to near 200,000 against the anticipated 220,000.
Eyes now turn to the December Nonfarm Payrolls (NFP) report, with market consensus expecting a 220,000 increase, significantly above November’s 160,000.
Asia-Pacific Markets
China's inflation data provided slight relief but underscored ongoing deflationary pressures. December PPI fell by 2.3% year-on-year, better than the 2.4% forecast but a continuation of November’s 2.5% decline. CPI rose 0.1% annually, meeting expectations, while monthly CPI remained flat after a 0.6% dip in November.
In Australia, retail sales posted a 0.8% annual increase in December, slightly below the 1% expectation but improving from November’s 0.6% rise.
European Markets
Germany's industrial production surpassed expectations, with November's monthly figures rising by 1.5% against a forecasted 0.5% decline. Year-over-year production contracted by 2.8%, better than the expected 4.5% drop. Additionally, the trade balance expanded significantly to EUR 19 billion, exceeding projections of EUR 14.5 billion.
Despite positive industrial data, the euro remained under pressure, trading near 1.0310 against the US dollar. A weaker-than-expected factory orders report and speculation around aggressive European Central Bank rate cuts contributed to the euro's third consecutive day of losses.
Gold
Prices struggled to sustain their recent gains, weighed down by a firm US dollar and expectations of tempered Federal Reserve rate adjustments. Geopolitical risks and global economic uncertainty continue to lend support to the safe-haven asset, limiting its downside. Meanwhile, a pullback in US Treasury yields added complexity to gold’s price action.
