With the Non-farm payrolls and wage data set to dominate the session today, the overnight picture shows small ranges in markets after Indices sold-off but recovered yesterday. The AUD moved up to 0.75600 in reaction to the RBA Monetary Policy Statement, as the bank upgraded its core inflation outlook for the year and set the tone for higher rates “to be appropriate at some point”. But this move has since reversed, moving below 75420, the level price traded at when the statement was released. Elsewhere, there is no news on the US/Chinese trade talks in Beijing, as the US delegation delivered a list of requests on trade, to their counterparts.
UK Markit Services PMI (Apr) came in at 52.8 against an expected 53.5, from 51.7 previously. This data is continuing to decline from its 2013 high of 62.5 and had fallen below 53.0, which had been somewhat of a floor over the last 18 months. The number disappointed yesterday, as it failed to move back above 53.0. GBPUSD moved down from 1.36191 to 1.35736 as a result.
US Continuing Jobless Claims (Apr 20) came in at 1.756M versus an expected 1.838M, against 1.837M previously, which was revised down to 1.833M. Initial Jobless Claims (Apr 27) was 211K versus an expected 225K, against 209K previously. This data is showing mixed results, with an increase failing to materialise, generating a miss on expectations but a slight uptick in Initial claims. Nonfarm Productivity (Q1) came in at 0.7% versus an expected 0.9%, against 0.0% previously, which was revised up to 0.3%. This shows efficiency slipping and ultimately upward pressure on inflation. Unit Labour Costs (Q1) was 2.7% versus an expected 2.9%, against 2.5% prior, which was revised down to 2.1%. This shows an increase in this metric despite the miss, with these costs eventually being passed onto consumers, raising inflation. The Trade Balance (Mar) was $-49.0B versus an expected $-50.0B, against a previous $-57.6B, which was revised down to $-57.7B. This data has recovered after reaching levels not seen since 2008 last month. GBPUSD tested up above 1.36000 initially but fell to 1.35377 after this data release.
Canadian International Merchandise Trade (Mar) was $-4.14B versus an expected $-2.24B, against a previous number of $-2.69B, which was revised down to $-2.93B. This data has fallen dramatically to match the low of November 2016. USDCAD tested higher to 1.28739 before reversing lower to 1.28431 following this data release.
US ISM Non – Manufacturing PMI (Apr) came in at 56.8 versus an expected 58.1, against 58.8 previously. This is still in the upper range of the data releases we have seen over the past seven years but off the highs of above 65.0 reached before the financial crisis. Factory Orders (MoM) (Mar) was 1.6% against an expected 1.4%, from 1.2% prior, which was revised up to 1.6%. USDJPY fell from 109.353 to 108.925 following this data release.
EURUSD is down -0.04% overnight, trading around 1.19833.
USDJPY is down -0.08% in early session trading at around 109.093.
GBPUSD is up 0.04% this morning, trading around 1.35774.
Gold is up 0.05% in early morning trading at around $1,312.63.
WTI is down -0.09% this morning, trading around $68.39.