Created
: 2024.08.23
2024.08.23 18:50
The latest batch of US data has not firmly argued in favour of a 50bp Federal Reserve rate cut in September, and most FOMC members have also appeared to moderately push back against that prospect in recent off-meeting comments. Yesterday, US services S&P Global PMIs were stronger than expected and compensated for another decline in manufacturing, while initial jobless claims rose only slightly, in line with consensus, to 232k. Continuing claims - a measure of the difficulty of re-entering the workforce - were less than expected and were revised lower for the previous week, ING's FX strategist notes.
"The payroll revisions published earlier this week showed the jobs market is loosening from a weaker position, but other activity/jobs indicators are not flashing amber, which should allow Fed Chair Jerome Powell to keep communication relatively balanced as he speaks at Jackson Hole today (1500 BST). He will probably use this speech to prepare markets for a September cut."
"When looking at market pricing, there is probably not much incentive to open the door to a 50bp move at this stage. 100bp is fully expected over the next three meetings, and the market tendency to price in more aggressively on the dovish side means hints of half-point moves could take the Fed funds futures curve uncomfortably low for the Fed. It appears more likely that Powell will re-emphasise the focus on both sides of the mandate."
"The risks for the USD are slightly upside-tilted today in our view. That said, we don't expect Powell's speech to have long-lasting ramifications for FX, and we retain a bearish bias on USD in the near term as the rebuilding of speculative positions following the recent rebalancing still looks more likely to favour dollar shorts."
Created
: 2024.08.23
Last updated
: 2024.08.23
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy