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    NFP to decide on the USD future

    As the OPEC’s and ECB’s meetings are over the market attention now turns to the Non-Farm Payrolls from the United States. The job data will be decisive in determining if the FED is to raise rates in 2 weeks, so a huge volatility is expected.

    Charles Evans says h’s of two minds at the moment which makes the FED’s policy uncertain. He sees two hikes this year, but on the other hand he suggests that the FED may stay pat for the rest of the year. Nevertheless, his speech is rather dovish, in line with his well known view. He doesn’t give a clue on whether he will vote for a hike in June, so the market shows no reaction.

    AUD remains one of the strongest currency within G10, and it is due to a moderate risk on (key indices gain around 0.7% following a fine session on Wall Street) but also a nice piece of data from Australia. AIG Services PMI (May) came in distinctly higher than previously: 51.5 vs 49.7 stepping into the expansionary territory. However, Chinese data mixed expectations and that may weigh on the AUD in the near future.

    Crude oil futures were little changed in early Asian trade Friday, having risen in the previous session after a decline in U.S. oil inventories offset a non-eventful OPEC meeting. OPEC refrained from changing its oil output policy on Thursday after members failed to agree on a new production ceiling. Oil prices found support instead in U.S. Energy Information Administration’s announcement of a fall in 1.4 million barrels of crude inventories, the third weekly decline in a row.

    European PMI’s turned out to be in line with what the market was expecting with a nastry surprise from Italy. We cannot observe any reaction on the data, but a trend in Italy’s economy is quite worrying. The country struggles with its banking sector and if the economy is to slow further, it may herald a greater problem for the European decidents. As for the UK, the data was suprisingly strong.

    Any person acting on this information does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it.

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