This NFP jobs report is very important, Here's why

Posted by Forexsq 36 days ago (
img Friday is a big day for the U.S. economy.

We will find out how many jobs America's economy added in August and whether wages are finally growing.

But this time the news goes beyond jobs and wages -- a big decision looms in less than two weeks for America's central bank, the Federal Reserve. And it seems to be coming down to the wire, where the jobs report could be the deciding factor.

"It should weigh heavily on the Fed's decision in that meeting," says Sal Guatieri, senior economist at BMO Capital Markets. "This report takes on elevated significance."

The reason is that the jobs growth would confirm the view that the U.S. economy is recovering nicely and strong enough to withstand higher interest rates.

Here's the dilemma: the stock markets are extremely jittery right now because of concerns over China's economic slowdown and its effect globally.

So the Fed could raise rates on September 17 and potentially risk creating even more volatility in global stock markets.

Payrolls Rose 173,000 in August as Jobless Rate Drops to 5.1%

Posted by Forexsq 36 days ago (
img Employers added 173,000 workers in August and the jobless rate dropped to 5.1 percent, a level that the Federal Reserve considers to be full employment.

The gain in payrolls, while less than forecast, followed advances in July and June that were stronger than previously reported, the Labor Department said Friday. The unemployment rate is the lowest since April 2008. Average hourly earnings climbed more than forecast and workers put in a longer workweek, the report also showed.

Persistent hiring indicates employers were upbeat about America’s demand prospects leading up to mounting concerns of further deterioration in emerging economies. Fed policy makers meeting in less than two weeks will weigh resilient U.S. employment conditions against the recent turmoil in world financial markets as they debate the timing of any interest-rate increase.

“The labor market is clearly still improving,” Jim O’Sullivan, chief U.S. economist at High Frequency Economics in Valhalla, New York, sa

U.S. unemployment rate hits 5.1%, lowest in 7 years

Posted by Forexsq 36 days ago (
img The American economy improved in August but not as much as people had hoped.

The U.S. economy added 173,000 jobs in August, a decent gain that was below expectations and might have dimmed the chances of the Federal Reserve raising its key interest rate in two weeks. Economists surveyed by CNNMoney projected that the economy would add 207,000 jobs.

The unemployment rate was 5.1% in August, down to its lowest level since April 2008.

In addition to the lukewarm jobs gains, wages didn't grow much in August either. Wages only rose 2.2% in August, about in line with expectations but well below the Federal Reserve's 3.5% target.

Wage growth has been missing during the U.S. economic recovery from the recession, and it's also a key measure of inflation -- something that's been absent and that the Fed badly wants to see.

Overall the job numbers in August add more uncertainty surrounding a potential rate hike from the Federal Reserve in two weeks. Fed officials have said they want

U.S. Existing home sales rise to eight-year high

Posted by Forexsq 51 days ago (
img U.S. home resales rose more than expected in July to their highest level since 2007, a sign the U.S. housing market was heating up and could provide more support for the overall economy.

The National Association of Realtors said on Thursday existing home sales increased 2 percent to an annual rate of 5.59 million units.

June's sales pace was revised slightly lower to 5.48 million units from the previously reported 5.49 million units.

Economists polled by Reuters had forecast home resales falling to a 5.44 million-unit pace last month. Sales were up 10.3 percent from a year ago.

A string of strong reports on the U.S. housing market supports the view that the U.S. economy is building up steam and closing in on the point when the Federal Reserve will hike interest rates to keep it from overheating.

The gain in home resales in July was driven by increases in America's South and West, regions that were hit hard by the housing bust of the 2007-09 recession.

Nationwide, the

Australia Labour Force, Unemployment increased

Posted by Forexsq 30 days ago (
img Employment increased to 11,765,400.
Unemployment increased to 778,400.
Unemployment rate remained steady at 6.2% from a revised July 2015 estimate.
Participation rate increased 0.1 pts to 65.0%.
Monthly hours worked in all jobs increased 0.7 million hours to 1,625.6 million hours.


Employment increased 17,400 to 11,775,800. Full-time employment increased 11,500 to 8,141,000 and part-time employment increased 5,900 to 3,634,800.
Unemployment decreased 14,400 to 781,100. The number of unemployed persons looking for full-time work decreased 3,500 to 561,400 and the number of unemployed persons only looking for part-time work decreased 11,000 to 219,700.
Unemployment rate decreased 0.1 pts to 6.2%.
Participation rate decreased 0.1 pts to 65.0%.
Monthly hours worked in all jobs decreased 0.6 million hours to 1,623.8 million hours.


Trend estimates : The labour force underutilisatio

Who's Next in the Currency Market's Race to the Bottom?

Posted by Forexsq 50 days ago (
img Kazakhstan just intensified the global currency war.

By allowing a 23 percent plunge in the tenge, central Asia’s biggest oil exporter signaled a new wave of devaluations in developing nations forced to compete against weaker currencies. Egypt and Nigeria look the most vulnerable to John-Paul Smith, the ex-Deutsche Bank AG strategist who predicted Russia’s 1998 crisis and this year’s China’s rout.

To Bernd Berg, a London-based strategist at Societe Generale SA, African currencies like the naira and those of former Soviet Union countries “will be next.”

Developing nations are under increasing pressure from weaker currencies in China and Russia, plunging prices for commodity exports and the prospect of higher U.S. interest rates. Kazakh President Nursultan Nazarbayev, who earlier this year pledged to avoid any sharp depreciation, said today’s adjustment was essential to avoid a recession.

“The major commodity exporters are the most vulnerable,” Smith, who founded Ecstrat, a

Forex : Which Country Will Devalue Their Currency Next?

Posted by Forexsq 30 days ago (
img Forex trading news : They're small, hopelessly devoted to oil and at risk of dropping their currency pegs.

Meet Equatorial Guinea, Libya, the Republic of Congo and Oman.

When Kazakhstan abandoned its dollar peg in the wake of China's shock yuan devaluation it warned other oil-producing countries would have to do the same as the world enters a “new era” of low oil prices. Here's a quick look at the economies in those four nations.
Equatorial Guinea and Congo

The economic fortunes of Equatorial Guinea changed overnight with the discovery of oil in the mid-1990s. The former Spanish colony the size of Massachusetts was transformed into one of the world's fastest-growing economies, yet also left dangerously reliant on a single source of revenue at a time crude price are tanking. Energy accounts for nearly 90 percent of its gross domestic product and virtually all of its exports.

What could tip Equatorial Guinea over the edge is that the Central African CFA franc it shares wit

Oil Price sinks 4 percent and hits new low on China

Posted by Forexsq 47 days ago (
img Oil prices fell more than 4 percent to fresh 6-1/2-year lows on Monday after Chinese stock markets suffered their biggest one-day drop since the global financial crisis, intensifying worries over the outlook for global oil demand.

Inaction by the Chinese government following an 11 percent rout in local stock markets last week encouraged a free-fall in global equities and other commodities on Monday. As a consequence, losses on the pan-European FTSEurofirst 300 .FTEU3 index for this month added up to as much as 1 trillion euros.

"Today's falls are not about oil market fundamentals. It's all about China," Carsten Fritsch, senior oil analyst at Commerzbank in Frankfurt, told Reuters Global Oil Forum.

"The fear is of a hard landing and that things get out of the control of the Chinese authorities."

Brent oil LCOc1 was trading down $1.85, more than 4 percent, at $43.61 a barrel at 0950 GMT, after touching an intraday low of $43.28, its weakest since March 2009.

U.S. light cr

Oil Price Will Go Lower Than $20, Goldman Says

Posted by Forexsq 29 days ago (
img The global surplus of oil is even bigger than Goldman Sachs Group Inc. thought and that could drive prices as low as $20 a barrel.

While it’s not the base-case scenario, a failure to reduce production fast enough may require prices near that level to clear the oversupply, Goldman said in a report e-mailed Friday while cutting its Brent and WTI crude forecasts through 2016. The International Energy Agency predicted that crude stockpiles will diminish in the second half of next year as supply outside OPEC declines by the most since 1992.

“The oil market is even more oversupplied than we had expected and we now forecast this surplus to persist in 2016,” Goldman analysts including Damien Courvalin wrote in the report. “We continue to view U.S. shale as the likely near-term source of supply adjustment.”

Goldman trimmed its 2016 estimate for West Texas Intermediate to $45 a barrel from a May projection of $57 on the expectation that OPEC production growth, resilient supply from out

The Fed Is Looking at a Very Different Dollar Than Wall Street

Posted by Forexsq 47 days ago (
img By many popular measures, the dollar has traded sideways for the last six months. Then there's the Federal Reserve's measure.

The greenback is surging, according to an index the Fed created to track the U.S. currency versus 26 of the country's biggest trading partners. It's risen 1.3 percent beyond a 12-year high reached in March, when the central bank fired the first of a series of warnings that a stronger dollar may hurt growth and lower inflation.

At a time when the Fed's tightening path has become one of the biggest drivers in the $5.3 trillion-a-day foreign-exchange market, the discrepancy between Wall Street's view -- largely based on the dollar's performance against the euro and the yen -- and that of policy makers may lead to a jolt for investors expecting recent ranges to persist. The rapid trade-weighted appreciation this quarter has come mostly against big exporters such as China and Mexico, and it undercuts the Fed’s goal of quicker inflation. It may trigger further

Forex : Depth Missing When Needed in $5.3 Trillion-a-Day Currency Market

Posted by Forexsq 26 days ago (
img Forex Market - Turbulent trading that made August the worst month for global equities since 2012 also revealed a widening crack in the world’s largest market-- foreign exchange.

Fabrizio Fiorini, chief investment officer at Aletti Gestielle SGR SpA in Milan, thought he was in luck as the financial turmoil curbed speculation the Federal Reserve would raise interest rates, sparking a stampede of dollar selling. To his dismay, he found that the gap between prices at which traders were willing to buy and sell major currencies had tripled, forcing him to pay a greater premium to purchase the greenback.

“During those two or three critical days in August, I was frustrated that liquidity, which seems to always be there when the market is quiet, disappeared when you need it the most,” said Fiorini, whose firm manages $18 billion. “Market makers are not able to provide liquidity the way they used to, and the market was too crowded with the same trades.”

The ability to exchange currenci

Black Monday because of China sinks world stocks and Forex Market

Posted by Forexsq 47 days ago (
img Alarm bells rang across world stocks and forex markets on Black Monday as a near 9 percent dive in China shares and a sharp drop in the dollar and major commodities panicked investors.

European stocks were more than 5 percent in the red and Wall Street was braced for similar losses after Asian shares slumped to 3-year lows as a three month-long rout in Chinese equities threatened to get out of hand.

Oil plunged another 4 percent, while safe-haven government U.S. an German bonds and the yen and the euro rallied as widespread fears of a China-led global economic slowdown and currency war kicked in.

"It is a China driven macro panic," said Didier Duret, chief investment officer at ABN Amro. "Volatility will persist until we see better data there or strong policy action through forceful monetary easing."

Many traders had hoped that such support measures, which could include an interest rate cut, would have come from Beijing over the weekend after its main stocks markets slumpe

Retail Sales in U.S. Rise as Consumers Unshaken by Turmoil

Posted by Forexsq 25 days ago (
img Retail sales in the U.S. climbed for a second straight month, a sign consumers may be looking past recent volatility in financial markets.

The 0.2 percent increase in August followed a 0.7 percent gain in July that was larger than previously reported, Commerce Department figures showed Tuesday in Washington. The median forecast of 84 economists surveyed by Bloomberg called for a 0.3 percent advance.

Although confidence has taken a hit from stock-market turmoil and global-growth concerns, the data show households are still putting their savings from cheap energy to work. More jobs and higher pay would go a long way in supporting household spending, which Federal Reserve policy makers are watching as they consider raising interest rates as soon as this week.

“The trend is strong and robust,” said Gregory Daco, head of U.S. macroeconomics at Oxford Economics USA in New York, who correctly forecast the increase in retail sales. Tuesday’s data shows spending is “resistant to outsi

Forex Market Biggest Day in Years as Investors Flee Risk

Posted by Forexsq 46 days ago (
img Traders in the $5.3 trillion-a-day forex market were busy Monday.

New Zealand’s dollar plunged as much as 8.3 percent, the most in 30 years, pacing declines by currencies of resource-producing nations amid a global market selloff. On the flip side, haven currencies surged on concern China’s slowing economy will damp global growth, with the yen climbing the most since 2010.

The U.S. dollar fell as traders pushed out expectations for higher interest rates from the Federal Reserve. The daily range of the ForexSQ Dollar Spot index, which measures the difference, or spread, between its intraday highs and lows, rose to levels investors last saw regularly during the financial crisis seven years ago.

“You’re talking about sovereign currencies moving that much, you’re not talking about equities -- it’s quite unusual,” Peter Gorra, head of foreign-exchange trading in New York at BNP Paribas SA, said by phone. “The spreads are naturally going to reflect the illiquidity in the market.”

Job growth seen accelerating, leaving Fed closer to hike

Posted by Forexsq 8 days ago (
img U.S. employers likely added jobs at a brisk pace in September, a sign that the labor market is near full strength and could push the Federal Reserve to raise interest rates at one of its two remaining meetings this year.

The Labor Department's monthly employment report, due on Friday at 8:30 a.m. EDT (1230 GMT), will almost certainly show the U.S. economy is growing enough to push the jobless rate lower in the coming months.

Economists surveyed by Reuters forecast U.S. payrolls outside of farming rose by 203,000 last month, bouncing back from softer job growth in August despite worries a China-led global economic slowdown is sapping America's strength.

"The U.S. economy is alive and kicking," said Phil Lachowycz, an economist at Fathom Consulting in London.

The jobless rate was expected to hold steady at 5.1 percent in September because some workers who gave up jobs hunts in harder times were expected to return to the labor force.

But economists estimate that the econom

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