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NFP and PMI in focus!

It is entering the new quarter with Non-Farm Payroll reports and Good Friday. A week full of dither will be with GDP data from the UK and Canada and OPEC report in the middle of the week. Let's check what we have to wait this week, ahead of Good Friday! Do not forget that this Friday is a holiday in Australia and New Zealand, while most European centers will also be closed. In the US, the NYSE is closed, as are some of the futures markets. For the bond market, it will be half-day, but it is not a US government holiday; that's why the NFP data will be published and essential as usual.

Besides all data, President Biden's speech will be on Wednesday, the last day of the month.

Labor market!

As always, US labor data, especially NFP numbers, will be important in the first week of every month.

To decrease the 6.3% unemployment rate to 6.0% of expectation, we expect another 600k increase in non-farm payroll numbers, after a 379K increase of the month before. Estimated numbers are based on the recent decline in the initial jobless claims, thanks to stimulus deposits and vaccination progress. However, as long as there are stimulate packages and government pays part of salaries or bonuses that prevents dismissals, it still can be early to feel confident. Currently, there are 18.953mn total claims for unemployment insurance in the US, so in the coming months, it is possible to see higher unemployment numbers. While the US average unemployment rate is 5.8%, the current 6-6.3% is not so bad and high.

Besides the unemployment number, we will have a workweek number, which is expected to rise to 34.8 from 34.6 in February. And since more jobs are opening, the numbers of lower salary jobs are rising, especially Cafe and Restaurant workers, which push the Average Hourly Earnings (YoY) to fall to 4.5% in March 5.3% of February.

Before we go to the following title, we have to mention Japan, German and Brazilian labor market numbers, published on Tuesday and Wednesday. In all three countries, a soft reduction in unemployment numbers is expected.

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GDP in UK, CAD, and Russia

Wednesday will be UK and Canadian day, as both countries due to release GDP numbers. The UK and Russia's numbers will be for Q4 2020, and Canada for January. After 0.1% growth in December, for Canada, it is expected to see 0.5% monthly economic growth, while for England, it is expected to have no change in initial 1% growth for the last quarter of the year.

Key Inflation numbers.

Germany on Tuesday and EZ data on Wednesday will get the most focus in Europe. The latest rise in Oil price and VAT change in Germany is expected to temporarily increase the costs and help reach close to the ECB's 2% target. The ECB's recently revised forecasts for inflation are 1.5% this year, 1.2% next year, and 1.4% in 2023. With ongoing price-pressures and weaker demand, the outlook remains below the ECB's inflation aim in the middle-term. Spain, Italy, French, Swiss, and Australia are also other countries that are planning to release their inflation numbers.

PMI data!

Manufacturing PMI is the most repeated data of the week because most economies plan to release their numbers in the next few days.

Chinese manufacturing on Wednesday, more than anything, will be watched by the energy market. The rise of the Chinese economy was one of Oil investors' most frequent questions in past months as there was a bit of concern on some part of China's economy, like in Export numbers, as European imports lowered at pandemic and recent warnings about construction bubbles.

The Bank of Japan's quarterly Short-Term Survey of Economic Conditions, universally known by its Japanese acronym, the Tankan, will publish on Thursday. The Tankan diffusion indices (Dis) for the more prominent companies, which market participants closely follow, are expected to rise, boosting Tokyo's stock markets.

Other than Japan and China, Australia, Spain, Russia, Italy, Eurozone, and United States also due to release the PMI data.

Source: https://tradeproskills.com

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06/12/23

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