LONDON, December 4, 2015 /PRNewswire/ --
After the disappointment from yesterday's ECB meeting that led to a big spike in volatility across all asset classes we've seen today's major nonfarm payroll data announcement from the US which has come in at 211k, above the expected 200k figure and even November's impressive release of 271k was revised upwards to 298k. Before the release Fed Fund futures were pricing in a 74% chance of tightening commencing in just under two weeks time, but this makes a rate hike from the Fed on 16th December a near certainty.
(Logo: http://photos.prnewswire.com/prnh/20150317/735436 )
Where average wages had previously been looking like they'd been coming in at around 2% a month throughout 2015, recent upward revisions show that wages have actually been rising more like 3% to 4% most recently, so it's little wonder that when Janet Yellen spoke on Wednesday she was more upbeat than usual about the US economy, including speaking of diminishing risks from abroad.
As has been the case for some time now that a rate hike could be coming this month, following the release we have seen a little softness in US Treasuries and strength in the dollar with GBPUSD dipping back below the 1.5100 level. Interestingly equity indices are heading higher with investors welcoming the data as it further reduces the uncertainty around the commencement of the Fed's tightening cycle. One of the most spoken about central bank policy events is soon to become a reality, but if you thought the Fed talk and debating is over think again as the focus will now shift to the timings of subsequent rate hikes in 2016.
Simon Smith, Chief Economist
Twitter: @simonsmithy
You can also follow FxPro's news on our insights blog or follow us on Facebook and Twitter.
Legal: The information in this article is not directed at residents of the United States, or targeted at the general public of any particular country. It is not intended for distribution to, or use by, residents in any country where such distribution or use would contravene any local law, or regulatory requirement. This marketing material should not be construed as a personal recommendation or as investment advice.
Risk Warning: Transactions in Contracts for Difference and Foreign Currency are leveraged products that can result in the loss of all your invested capital. These products may not be suitable for everyone. Please seek advice if you do not fully understand the risks. You should not risk more than you are prepared to lose. Before deciding to trade, please ensure you understand the risk involved and take into account your level of knowledge and experience. Seek independent advice if necessary.
SOURCE FxPro
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article