This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Today’s rally may be a hint that market participants are starting to weigh up whether the market has been oversold in response to the woes of emerging-market currencies. There have been a few wobbles in macro data, notably with Monday’s ISM manufacturing index, but on balance US fundamentals look quite buoyant, even more so after taking stock of today’s improving jobless claims and healthy productivity data.
Jobless claims slid to 331,000 last week, improving by 20,000 from the week before, and comfortably better than forecast by analysts polled by Reuters beforehand, who had given a consensus estimate of 335,000. The definitive snapshot of the labour market will be available with tomorrow’s monthly government report, but today’s data will have brightened perceptions of how the jobs market is faring.
Fourth-quarter US productivity increased at an annualised pace of 3.2%, surpassing analyst predictions of 2.5%, and the previous quarter’s rate was amended higher to 3.6% from a previously announced level of 3.0%.
EUR/USD remains up on the day several hours after the ECB held off from introducing any additional stimulus measures. The euro had strengthened against most major currencies, gaining 0.43% against the dollar and 0.87% against the yen.