Skip to main content
Home
  • English
  • العربية
  • SUPPORT
  • Log in
  • JOIN EXINITY
  • Markets
    • Markets

    Explore global financial markets

    Individual stocks
    • Stocks
    • Stock CFDs
    Forex and commodities
    • Forex pairs
    • Commodities
    Indices
    • Indices
    • Currency indices
  • Ways to trade
    • Ways to trade

    Explore our services at a glance

    • Exinity World

    Get pure investing simplicity and build a global portfolio from just $20

    • Exinity Trader

    Been trading for a while?
    Say hello to Trader

    • Exinity Trader Pro

    Pro, meet pro.
    The service for experienced traders

  • Edge
    Edge

    The markets are full of opportunity, but you won’t find it by accident. Edge puts useful and jargon-free insight at your fingertips.

    Edge library
    • Understanding the markets
    • Analysis and forecasting
    • Understanding risk and returns
    • Learning from experience
    Trading ideas
    • What our experts say
    • Meet our experts
  • About

What our experts say

Week Ahead: US inflation to bolster USD bulls?

Han Tan
Chief Market Analyst
06.08 @ 16:50 GMT
Han Tan

Before we look at the coming week, let’s first dive into this blockbuster US nonfarm payrolls report that was released about an hour ago.

  • The July NFP figure of 943,000 – the highest headline print since August 2020 - smashed the forecasted 870k figure!
  • June’s NFP was also revised upwards to 938,000 compared to the initial 850k announced on the first Friday of July.
  • Last month, the unemployment rate fell by 0.5 percentage points to 5.4%, which is now much lower than the pandemic peak of 14.8% in April 2020.
  • Perhaps the most important figure in some Fed officials’ eyes: the US jobs market is also now just 5.7 million away from the pre-pandemic peak.

The numbers above should go some ways towards the “substantial further progress” in the jobs recovery that the Fed demands as a precursor to its actual tapering.

This positive surprise in the US nonfarm payrolls report has spurred the equally-weighted US dollar index into breaching its 200-day simple moving average resistance level.

Armed with these latest readings on the US jobs market, that would frame market expectations as they brace for the Fed speak and the July US CPI data due in the coming week, along with these other potential market-moving events:

Monday, August 9

  • Japan markets closed
  • China CPI, PPI
  • Germany external trade
  • Fed speak: Atlanta Fed President Raphael Bostic, Richmond Fed President Tom Barkin

Tuesday, August 10

  • Australia business confidence
  • Germany ZEW survey expectations
  • Fed speak: Cleveland Fed President Loretta Mester

Wednesday, August 11

  • EIA crude oil inventory report
  • Fed speak: Atlanta Fed President Raphael Bostic, Kansas City Fed President Esther George
  • US CPI

Thursday, August 12

  • OPEC monthly oil report
  • Eurozone industrial production
  • UK industrial production, 2Q GDP
  • US weekly jobless claims

Friday, August 13

  • Eurozone trade balance
  • US consumer sentiment

 

Commentary by Fed officials in the coming week would be further scrutinized in light of this positive surprise in the US nonfarm payrolls report.

Should more and more Fed officials start singing a hawkish tune, that could really push the US dollar closer towards its year-to-date high.

While Fed officials have often deemed US inflationary pressures to be “transitory”, another strong CPI print could give the hawks added reason to taper sooner rather than later. That should translate into rising yields and a stronger dollar, at the expense of spot gold prices.

On the back of today's NFP upside surprise, bullion is on the cusp of forming a 'death cross' (50-day simple moving average crossing below its 200-day counterpart).

When such a technical event is confirmed, that could herald even more declines for this precious metal, which is already about to wrap up its biggest weekly decline (-2.6%) since the week of the hawkish surprise from the June FOMC meeting and is now trying to find support around its 23.6% Fibonacci retracement level from the August 2020 record high.

Disclaimer: This material is comprised of personal opinions and ideas. It should not be construed as an investment recommendation or a solicitation for any transaction. It does not imply any obligation to purchase investment services, nor does it guarantee or predict future performance. Exinity, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.

Ready to jump into the markets?

Choose your Exinity experience and create your account in minutes

JOIN EXINITY
  •  
  •  
  •  
  •  
Home
  • About us
    • Exinity Group
    • Careers
    • Company news
    • Meet our experts
  • Useful links
    • Trading platforms
    • Trading tools
    • Trading hours
  • Support
    • FAQ
    • Contact us

The services on the Website are provided by Exinity Limited (exinity.com), regulated and licensed by the Financial Services Commission of the republic of Mauritius with an Investment Dealer License bearing license number C113012295.

Card transactions are processed via Exinity Services Limited (EU merchant company), a company incorporated in the Republic of Cyprus with company number ΗΕ 400404, registered office at 64 Agiou Georgiou Makri, Anna Maria Lena Court, Office 201, 6037, Larnaca, Cyprus and regulated by the laws of Cyprus. Address for cardholder correspondence: [email protected] Business location address: 35 Lamprou Konstantara, Kato Polemidia, 4156, Limassol, Cyprus.

Exinity ME Ltd is registered under the Laws of the Abu Dhabi Global Market (“ADGM”), with registered offices at 16-104, 16 Floor, Al Khatem Tower, ADGM Square, Al Maryah Island, Abu Dhabi, UAE. It is regulated by the Financial Services Regulatory Authority (“FSRA”), Financial Services Permission Number 200015 and is a duly licensed Category 3A Firm authorized to provide financial products and services to persons who meet the qualifying criteria of a Professional Client as defined by the FSRA rules.

Risk Warning: Trading Forex and Leveraged Financial Instruments involves significant risk and can result in the loss of your invested capital. You should not invest more than you can afford to lose and should ensure that you fully understand the risks involved. Trading leveraged products may not be suitable for all investors. Trading non-leveraged products such as stocks also involves risk as the value of a stock can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results. Before trading, please take into consideration your level of experience, investment objectives and seek independent financial advice if necessary. It is the responsibility of the Client to ascertain whether he/she is permitted to use the services of the Exinity brand based on the legal requirements in his/her country of residence. Please read Exinity’s full Risk Disclosure.

Regional restrictions: The Exinity brand does not provide services to residents of the USA, Japan, New Zealand, Canada, Mauritius, Haiti, Hong Kong, Suriname, the Democratic Republic of Korea, Puerto Rico, the Occupied Area of Cyprus.

© 2021 Exinity

Terms and agreements   |   Privacy   |   Cookies