Jobs Day in The US
Today is “Jobs Day” in the US as the eagerly awaited nonfarm payroll data and March unemployment data are published in the US. We are looking for a figure of 200,000 new nonfarm jobs created as opposed to last months 175,000 and unemployment down from 6.7% to 6.6%. We should probably not expect to see the same volatility as previously on the back of these figures as Janet Yellen removed inflation and unemployment thresholds from forward guidance last month.
As expected we saw no movement on interest rates, or other stimulus measures, from the ECB yesterday although it was Mario Draghi’s press conference which gave thought for the future and caused the markets to move. Whilst speaking about how they came to their decision and what was discussed in the meeting, the Euro was weakened against the Pound. Draghi opened the door for a Eurozone version of quantitative easing, although it seems unclear exactly how that would work due to restrictions. Draghi also commented on how the ECB was unanimous in its commitment to exploring new avenues.
This has all helped the Pound strengthen again versus the Euro as even though we have seen some weak data out of the UK this week, especially the services PMI, it is still seen as being a much better bet than the Euro in the long term as the UK economy is seen as being much more attractive than the Eurozone.
This weekend also sees the Grand National at Aintree tomorrow. This is the time when the whole of Britain bets on something it doesn’t really know a great deal about. We, at CurrencyUK are no different and having studied the formbook we are going to back Shakalakaboomboom. This has nothing to do with us liking the name.