The biggest paycheck Australia has ever seen 🤑

PLUS: Volatility alert - NFP on the books 🚨

It’s Thursday AND international kissing day!

Sooo….

Knock, knock! Who's there?

Howard. Howard who?

Howard you like a big kiss? 😏

Only have a minute? ⏱

Key Takeaways:

  • USA: The Fed's June meeting minutes showed that they’ve decided to slow down their rate hike train. 🚂 But not for long.

    • It looks like they're just taking their time to figure out how best to get inflation back down without causing an economic disaster. 👀

  • Australia: Can anyone hear Australia celebrating? 🥳 

    • They should be after the release of their trade surplus of $11.8 billion - largely thanks to the export of gold, natural gas and coal.

  • USA: NFP is on the books for tomorrow. Last month, 339K jobs were added to the US economy. The consensus for June is 225K jobs added.

    • Expect EURUSD ↓

  • Canada: Tomorrow Canada releases their employment reports.

    • 17,000 Canadians lost their jobs in May and the unemployment rate rose for the first time in 9 months to 5.2%. The consensus for June is that 20,000 were hired!

    • Expect USDCAD ↓

Fed goes back to the drawing board 👨🏻‍🏫

The Fed's June meeting minutes showed that they’ve decided to slow down their rate hike train. 🚂

But not for long.

It looks like they're just taking their time to figure out how best to get inflation back down without causing an economic disaster. 👀

So after increasing the rate by 5 percentage points in total, the 18 members argued over how many more increases were in store for us.

To me?

It seems like the Fed might have run out of good options - unless you consider slowly killing off our purchasing power a good option. 😬

So here we are again:

Stuck with interest rates that don't really help anyone and are certainly not doing enough to combat inflation. 🙃

So what does this all mean?

Well, they seem intent on taking their time...at least until they figure out how best to get inflation back down without causing damage elsewhere.

The biggest paycheck Australia has ever seen 🤑 

Can anyone hear Australia celebrating? 🥳

They should be after the release of their trade surplus of $11.8 billion - largely thanks to the export of gold, natural gas and coal.

Not only did exports rise by 4%, but imports also experienced an uptick of 2%.

It seems international buyers just couldn't get enough of Aussie items.

Why is a trade surplus such good news?

It means that Australia is selling more goods and services than it is buying from other countries. So they’ve got some extra cash on hand. 🤑

The cherry on top? 🍒

This was the biggest influx of money in history that Australia has seen in a single month!

Trade Of The Day 📈

AUDUSD

July 5th, 2023 - 21:30 EST - Australia Trade Balance Release

Friday News

FINALLY, it’s Friday! 🍾

Here’s what you’re in for before market close:

(All times in EST)

  • 08:30 — Volatility alert: NFP on the books 🚨

    • Event: USA: Nonfarm Payrolls for June

    • Major pairs to watch: EURUSD, XAUUSD

  • 08:30 — Canada’s employment numbers don’t tell the whole story 👀

    • Event: Canada: Net Change in Employment & Unemployment Rate for June

    •  Major pairs to watch: USDCAD

Volatility alert: NFP on the books 🚨

Nonfarm payrolls (NFP) is on the books for tomorrow so if you’re looking for high volatility to trade, you’ve found it. 🕵🏻‍♀️

Why does NFP have such a big impact on the FX market?

The Fed keeps a close eye on the labour market as they make decisions about interest rates. 👀

If more people are employed and have extra cash to spend, another hike might come sooner than later.

If the number of new jobs goes down, they might consider another pause. ⏸

And with their interest rate decision coming in just a few weeks, you can be sure that their eyes will be peeled tomorrow morning. 🧐

Last month, 339K jobs were added to the US economy. The consensus for June is 225K jobs added.

Expect EURUSD ↓

Canada’s employment numbers don’t tell the whole story 👀

And before we can pack it in for the weekend, we’ll see how many Canadians were hired (or fired) in June.

And it’s looking like good news. 👀

17,000 Canadians lost their jobs in May and the unemployment rate rose for the first time in 9 months to 5.2%.

The consensus for June is that 20,000 were hired!

Expect USDCAD ↓

But unemployment is expected to rise again to 5.3%.

What gives? 🧐

The truth behind this seeming contradiction has to do with a few key factors. 🤷‍♀️

For starters, some people may have lost their job in June but their cases won’t be reported until July when official numbers are updated.

There's also the matter of those who are temporarily employed or take up seasonal jobs.

A lot of businesses bring in extra staff during peak times; like summer! Which is the season Canada is in right now. 🌞

These positions aren't permanent so they’re not accounted for.

And let's not forget the potential discrepancies between private sector employment and government data.

In certain cases, there could be more jobs created than we’re actually seeing due to small business startups or expanding operations that aren't picked up by official stats! 🕵🏻‍♀️

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