US Initial jobless claims number has increased, reaching 744K in the week to April 3rd after 728K and 658K in the previous two weeks.
Economists had expected a fall under 700K, which would have confirmed unemployment’s downtrend.
The latest rise dampens hopes of a strong labour market recovery, returning the gauge to the range seen since August.
The number of jobless claims remains on a downward trend but also falls short of expectations. The new report showed 3734K claims after 3750K and 3841K in the previous two weeks.
It is hard to call this news unequivocally negative for the dollar or risk demand, but traders should be aware that labour market slippage may cause markets to reassess expectations. Despite cautious employment estimates from the Fed or US Treasury, markets have priced in a quick recovery.
As history suggests, after the global financial crisis of ’08, initial forecasts were too optimistic. But in the months and years after, the Fed increased support for the economy, adding one round of QE after another.
The FxPro Analyst Team