Overnight, trade data from China was not as good as expected however the market reaction was muted with Asian stock markets slightly in Green, with China being the exception (-2.35%). In the US, Friday’s NFP showed the weakest job growth in 7 months with only 160,000 new jobs added signaling a slowdown, something that will most likely force the FED to push the timing of interest rate hikes, even further than June.
Currencies: USD is slightly under pressure today after Friday’s rollercoaster. EURUSD remains around 1.14 after dropping nearly 1% last week. The other major pair, GBPUSD, also trades flat today at 1.4425, after spiking to multi month highs at 1.4760 2 weeks ago. Looking ahead, BoE “Super Thursday” is the main focus of the week for the pair. There is no chance for a change in policies with before highly anticipated EU referendum in June. But markets will look for adjustments in the central bank’s economic projections.
GOLD and OIL: OIL continued its rise this morning in Asia, following Friday’s rally backed up by the Canadian wildfire that threatened its oil production. Despite Friday’s gains, oil prices ended the week lower as concerns over a global supply glut remained. GOLD remains vulnerable at 1280, but managed to hold on to gains despite the stronger USD. GOLD hit a 5 month high last week at $1303 after gaining more than 22% in 2016.
Stocks: Asian stocks fell on Monday, as oil prices rallied on supply outages in Canada and amid surprise over the exit of Saudi Arabia’s veteran oil minister Ali al-Naimi.
The focus this week is in the UK where the BOE meeting due Thursday should bring no change in the monetary stance. The coming week would be a less busy one in the US with the most important data being Friday’s retail sales.