Wij gebruiken een aantal cookies om u de best mogelijke browser ervaring te bieden. Door deze website te blijven gebruiken, gaat u akkoord met ons gebruik van cookies. U kunt hier meer leren over ons cookie-beleid of door op de link te klikken onderaan iedere pagina van onze website.
This means the release of September’s non-farm payroll numbers and the unemployment rate will hit the newswires this week. There are several other pieces of data due for release that have been postponed, but it’s the jobless rate and non-farms that will draw the most attention from the market as we approach the October Fed meeting.
Expectations are that the September jobs numbers were stronger than August; however questions remains whether they will be strong enough to shift the unemployment rate, which is the lowest level since 2008.
I expect that the unemployment rate will hold; the fact that the government shutdown is believed to have cost US growth 0.6% out of fourth quarter GDP, and with the budget debate due for ‘renegotiation’ by December 13, the ‘taper talk’ over the weekend seemed completely immaterial as the likelihood that the Fed will move is very low.
The September data will not be stronger enough to shift the board’s mind, despite the robust debate at the September meeting. The effect of the shutdown has not been completely quantified and won’t be until November/December most likely, as the effects are retrospectively collated and presented to the markets.
On Friday we did see the usual suspects talking up each of their respective positions. Dallas Fed president Richard Fisher (major dove) stated that ‘the fiscal shenanigans’, which has undermined the case for tapering; Kansas City Fed President Esther George who has abstained from voting all year reiterated her stance as a major hawk, commenting that the Fed has ‘enough data to assess the economy’s strength and should taper even amid fiscal uncertainty of the last few weeks’.
However, the ‘data dependency’ of the Fed will mean no tapering and is why, over the coming weeks, the record highs in the US and Europe and the five to six year highs in the Middle East and Asian markets will continue. Stimulus is here for at least another three months and will pump up risk (equities).
Ahead of the Australian open
It will be a quiet week on the macro front for Australia; the local consumer price index is due for release on Wednesday, with the only other major piece of news this week coming from deputy governor Philip Lowe who is due to give the annual RBA report on Thursday.
Let’s hope he has a little more to say about the current rate cycle and puts a bit more colour into the direction of the AUD, having only got one throwaway line from Glenn Stevens last Friday about whether the RBA has the tools to move the AUD.