The US was the focus of Friday with the release of the average hourly earnings figure, non-farm employment change and the unemployment rate coming out of the US. Non-farm payroll posted better than expected at 222k, bouncing back from last month’s figure of 152k. However, the unemployment rate increased slightly to 4.4% from last month’s 4.3% and the average hourly earnings ticked down to 0.2%. Also out Friday was the Fed Monetary policy report, which showed the US would be sticking to raising interest rates gradually and for balance-sheet normalisation to begin this year. Due to the impressive rebound of jobs the Dollar saw a boost Friday afternoon.
Last week ended with the G20 meeting taking place in Germany. Prior to his first G20 meeting as US President, Donald Trump mentioned on Twitter he planned to discuss topics including bad trade deals and North Korea’s nuclear ambitions after North Korea claimed it would be able to destroy the US mainland and could easily wipe out South Korea. Trump held talks with China to discuss denuclearisation of Korea. The G20 leaders discussed trade agreements, stepping back from the commitment to free trade and recognising the need for defensive measures to pursuit balanced trading. Also during the meeting, 19 of the 20 nations renewed their pledge to implement the Paris deal on Climate change, with the US, who are in the process of withdrawing from the agreement, being the only nation not to.
There is a quiet start to the week, with no high tier data released. A couple of pieces of lower tier data will be coming out of the US and the Eurozone, in the form of the US labour market conditions, US consumer credit figure, Eurozone Sentix investor confidence report and the German Trade Balance
On Tuesday, two MPC members will be speaking. The first will be Andy Haldane, who is due to take part in a panel discussion at the Bank of England. The BOE Deputy Governor, Ben Broadbent, is due to then speak at the Scottish Council for Development and Industry around midday. From the US, the JOLTs job opening figure will be released and FOMC member Lael Brainard will be speaking about monetary policy at Columbia University.
Wednesday starts with the release of the UK average earning index, expected to drop to 1.8%, and the claimant count change, expected to increase to 10.4k from the previous month’s 7.3k. Across the pond, Fed Chair Janet Yellen starts her two day testimony on the semi-annual monetary policy report before Congress.
On Thursday, the final CPI figures will be released from both Germany and France. The UK will release the BOE credit conditions surveys. The day will end with the focus moving to the US with the release of the PPI figure and the weekly unemployment claims figure. Fed Chair, Janet Yellen, will continue to testify before congress and two FOMC members will be speaking. Charles Evans will be speaking about the economy and monetary policy at the Ninth Annual Rocky Mountain Economic Summit and Lael Brainard will be speaking at the National Bureau of Economic Research. Audience questions are expected at both.
On Friday, the focus will remain to be on the US with the release of the CPI and retail sales figures. FOMC member Robert Kaplan will be speaking about the Federal Reserve and monetary policy at the Centre for economic studies of the private sector in Mexico City. Questions from the audience are expected.