empty
02.01.2024 01:02 PM
Deteriorating US labor market will stimulate risk appetite and globally weaken dollar

Global markets open today, albeit not completely. Exchanges in Europe and the US have resumed operations, while the holidays continue in other regions.

Looking at the overall dynamics, investors may continue the bullish momentum noted at the end of last year. The main driver of this will be the expected easing of interest rates by the Fed and other global central banks.

Upcoming economic data, especially those related to the US labor market, will also affect the market's direction. ADP's report on the number of new jobs, which forecasts say will increase to 113,000 in December compared to 103,000 in November, could lead to a decline in dollar because the figure remains very low and the labor market needs a stable number above 200,000. Similarly, although a slight decrease in the number of jobless claims, from 218,000 to 215,000, may be seen, the total number remains above 200,000.

Official data from the US Department of Labor will also attract attention as it will show changes in employment in December, the number of new jobs, the average length of the workweek, and the average hourly earnings. For the number of new jobs, a decrease in growth from 199,000 to 163,000 may occur. The unemployment rate may slightly rise from 3.7% to 3.8%, while the average length of the workweek may remain at 34.4 hours. Hourly earnings may decrease from 0.4% to 0.3%.

A worsening situation in the labor market will be a strong signal for the purchase of risk assets and the weakening of dollar. Such a piece of news can be interpreted by the Fed as an important reason to start lowering interest rates in the first quarter of 2024.

Forecasts for today:

This image is no longer relevant

This image is no longer relevant

EUR/USD:

The pair found support at the level of 1.1000. The worsening situation in the US labor market, as well as the likely resumption of inflation growth in the Eurozone, could be the basis for growth to 1.1130.

GBP/USD

The pair traded at 1.2700. Weakening dollar due to a bleak picture in the US labor market may lead to an increase to 1.2825.

Pati Gani,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

EUR/USD. Analysis and Forecast

Today, the EUR/USD pair is showing signs of recovery but continues to face challenges as the U.S. dollar strengthens amid progress in trade negotiations between the United States and China

Irina Yanina 11:08 2025-05-13 UTC+2

USA and China: A 90-Day Truce. U.S. Inflation Report in Focus (High probability of a decline in EUR/USD and GBP/USD)

On Monday, the markets breathed a sigh of relief following the announcement of a trade agreement between the United States and China. The deal involves mutual tariff reductions, but only

Pati Gani 10:07 2025-05-13 UTC+2

The Market Hits the Jackpot!

Bingo! No one could have dreamed of such an outcome from the U.S.-China meeting—not even in their most optimistic fantasies. The reduction of U.S. import tariffs from 145% to 30%

Marek Petkovich 09:20 2025-05-13 UTC+2

GBP/USD Overview – May 13: The British Pound Takes a Low Blow

The GBP/USD currency pair plummeted rapidly on Monday. The U.S., represented by Treasury Secretary Scott Bessent, announced the first signs of progress in trade negotiations with China. Following a bilateral

Paolo Greco 07:30 2025-05-13 UTC+2

EUR/USD Overview – May 13: The U.S. And China Unexpectedly Reached an Agreement

On Monday, the EUR/USD currency pair dropped sharply, like a rock falling. Can you guess who deserves the credit for that? It's none other than Donald Trump. Though this time

Paolo Greco 07:30 2025-05-13 UTC+2

What to Pay Attention to on May 13? A Breakdown of Fundamental Events for Beginners

Quite a few macroeconomic events are scheduled for Tuesday, but most are expected to have only a minor impact on the movement of both currency pairs. As a reminder

Paolo Greco 05:59 2025-05-13 UTC+2

EUR/USD. The Dollar Is Back in the Saddle. But for How Long?

The greenback is back on top: the U.S. Dollar Index hit a four-week high on Monday, responding to the announcement of a three-month truce in the trade war between

Irina Manzenko 01:01 2025-05-13 UTC+2

China Helped the Dollar Halt Its Decline

The CFTC report released on Friday showed minimal changes in overall currency positioning, with the net USD position against major currencies decreasing by a symbolic $0.1 billion to—$17.2 billion

Kuvat Raharjo 00:24 2025-05-13 UTC+2

The Dollar Takes Time to Saddle Up but Rides Fast

Investors have shifted from the "Sell America" strategy that emerged after the White House imposed tariffs to "Buy America" amid positive developments in U.S.-China trade relations. While the S&P

Marek Petkovich 00:23 2025-05-13 UTC+2

Bitcoin Has Completed Its Minimum Task

Bitcoin has broken above the 100,000 mark, entered a consolidation phase, and confirmed the familiar pattern. Previously, after breaking through psychologically significant levels, the cryptocurrency experiences a period of stagnation

Marek Petkovich 00:23 2025-05-13 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.