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• Prior was 241K
• Continuing claims 1.916m vs 1.864m exp

Note that all the claims appeared to be from New York State, which argues this was a quirk rather than a troubling turn in the jobs market.

h/t @zerohedge

This article was written by Adam Button at www.forexlive.com.

• Hopeful for progress with China on trade.
• We are very close to making progress with China.
• Have hard offers from more than 20 countries.
• Trump doesn’t support a tax increase on the wealthy.

There’s been lots of de-escalating comments in the recent days with China and we even got the news of the US reaching to China for tariff talks (even though we haven’t got any official statement). It’s clear that they can’t go on with this trade war for too long as the economic damage would be big for both of them.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The market appears to be coming around to the idea that the US economy is fine, or at least that it was fine before April.

The combination of upbeat commentary from Visa and the internals of yesterday’s GDP report has the market thinking that the economy is on strong footing. The recent initial jobless claims numbers bear that out but that set will be tested again today. The consensus is 224K, up a touch from 222K a week ago.

Then at 10 am ET, the focus will shift to the industrial economy with March construction spending and April ISM manufacturing. The latter is expected to slip to 48.0 from 49.0. Lately there has been a focus on the ‘prices paid’ numbers as well but with oil prices cratering, the market is seeing more room for the Fed to cut rates.

WTI crude was last down $1.21 to $57.00.

This article was written by Adam Button at www.forexlive.com.

BOJ press conference:

• USD/JPY extends gains as Ueda delivers more dovish messaging
• BOJ governor Ueda: Uncertainty stemming from trade policies have heightened sharply
• BOJ governor Ueda: Underlying inflation to cool down due to tariffs, slower global growth
• BOJ governor Ueda: Timing of next rate hike could be swayed a lot depending on tariffs
• BOJ governor Ueda: If the outlook changes, then we will need to adjust our policy
• BOJ governor Ueda says would expect US tariffs to be above the base 10% levied

Headlines:

• US futures continue to hold up in European morning trade
• No relief for oil as price continues to tumble lower
• The market sees more Fed rate cuts after the weak US GDP but it could be wrong
• US Bessent: Need to see de-escalation with China on tariffs
• US Treasury Secretary Bessent on the economy: We expect to see GDP revised
• UK March mortgage approvals 64.31k vs 64.80k expected
• UK April final manufacturing PMI 45.4 vs 44.0 prelim
• US April Challenger layoffs 105.44k vs 275.24k prior

Markets:

• USD leads, JPY lags on the day
• UK FTSE flat; S&P 500 futures up 1.1%
• US 10-year yields down 3.8 bps to 4.136%
• Gold down 2.5% to $3,203.53
• WTI crude down 2.2% to $56.92
• Bitcoin up 1.8% to $96,241

There wasn’t too much in European trading today amid a holiday in conjunction with Labor Day.

BOJ governor Ueda’s press conference at least helped to keep things a little interesting, as he delivered more dovish remarks on the economy and inflation. That is leading to markets thinking about a further pause on rates in June next, following the decision today.

USD/JPY nudged higher from 144.20 to 144.75 during the presser and is still largely holding gains, seen up 1% at 144.50 levels now.

Besides that, there wasn’t too much action in the FX space. The dollar is keeping steadier across the board, but mostly little changed against the other major currencies. EUR/USD is lightly down by 0.1% to 1.1320 but was hovering around 1.1300 at the tail end of Asia trading. Meanwhile, GBP/USD is flat at 1.3325 and USD/CAD just up slightly by 0.2% to 1.3823 currently.

In other markets, US futures are keeping higher after the late rebound from Wall Street yesterday. And the mood is helped by a jump up in tech shares after stronger earnings from Meta and Microsoft.

We had US Treasury secretary Bessent out with some remarks as well but nothing that is too meaningful, mainly just a repeat of what we’ve heard before. It’s now more about walking the walk, not talking the talk.

The bond market is also continuing to hold the calm, so that’s keeping the risk mood in a better spot to start the month.

In the commodities space, gold is pushed down as it breaks away from its recent consolidation. The $3,200 level is now eyed next amid the break from the short-term technical range over the past week or so.

Oil was a bit of a standout mover as it dipped down to a low of $56.40 as concerns continue to grow on multiple fronts on the oil market.

This article was written by Justin Low at www.forexlive.com.

BOJ press conference:

• USD/JPY extends gains as Ueda delivers more dovish messaging
• BOJ governor Ueda: Uncertainty stemming from trade policies have heightened sharply
• BOJ governor Ueda: Underlying inflation to cool down due to tariffs, slower global growth
• BOJ governor Ueda: Timing of next rate hike could be swayed a lot depending on tariffs
• BOJ governor Ueda: If the outlook changes, then we will need to adjust our policy
• BOJ governor Ueda says would expect US tariffs to be above the base 10% levied

Headlines:

• US futures continue to hold up in European morning trade
• No relief for oil as price continues to tumble lower
• The market sees more Fed rate cuts after the weak US GDP but it could be wrong
• US Bessent: Need to see de-escalation with China on tariffs
• US Treasury Secretary Bessent on the economy: We expect to see GDP revised
• UK March mortgage approvals 64.31k vs 64.80k expected
• UK April final manufacturing PMI 45.4 vs 44.0 prelim
• US April Challenger layoffs 105.44k vs 275.24k prior

Markets:

• USD leads, JPY lags on the day
• UK FTSE flat; S&P 500 futures up 1.1%
• US 10-year yields down 3.8 bps to 4.136%
• Gold down 2.5% to $3,203.53
• WTI crude down 2.2% to $56.92
• Bitcoin up 1.8% to $96,241

There wasn’t too much in European trading today amid a holiday in conjunction with Labor Day.

BOJ governor Ueda’s press conference at least helped to keep things a little interesting, as he delivered more dovish remarks on the economy and inflation. That is leading to markets thinking about a further pause on rates in June next, following the decision today.

USD/JPY nudged higher from 144.20 to 144.75 during the presser and is still largely holding gains, seen up 1% at 144.50 levels now.

Besides that, there wasn’t too much action in the FX space. The dollar is keeping steadier across the board, but mostly little changed against the other major currencies. EUR/USD is lightly down by 0.1% to 1.1320 but was hovering around 1.1300 at the tail end of Asia trading. Meanwhile, GBP/USD is flat at 1.3325 and USD/CAD just up slightly by 0.2% to 1.3823 currently.

In other markets, US futures are keeping higher after the late rebound from Wall Street yesterday. And the mood is helped by a jump up in tech shares after stronger earnings from Meta and Microsoft.

We had US Treasury secretary Bessent out with some remarks as well but nothing that is too meaningful, mainly just a repeat of what we’ve heard before. It’s now more about walking the walk, not talking the talk.

The bond market is also continuing to hold the calm, so that’s keeping the risk mood in a better spot to start the month.

In the commodities space, gold is pushed down as it breaks away from its recent consolidation. The $3,200 level is now eyed next amid the break from the short-term technical range over the past week or so.

Oil was a bit of a standout mover as it dipped down to a low of $56.40 as concerns continue to grow on multiple fronts on the oil market.

This article was written by Justin Low at www.forexlive.com.

• We expect to see GDP revised.
• GDP decline may have been due to inventory stocking of imports.
• US households consumption is strong.
• 2 year yield below the 10 year yield is a signal that the Fed should cut rates.
• Our policies will bring down inflation.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The 105,441 job cuts last month is 63% higher compared to the same month last year. That brings the year-to-date total to 602,493 layoffs now, which is the highest since 2020. For some context, the figure is some 87% higher compared to the first four months of 2024. It once again underscores the impact of the DOGE layoffs, with 281,452 of those job cuts being directly attributed to that.

This article was written by Justin Low at www.forexlive.com.

Bessent sounds like he got a good whipping before coming out with his remarks today. But if the idea is to try and convince that there is a plan, the headline remark doesn’t really help to be honest. The market needs the answer to this question: What are tariffs for?

This article was written by Justin Low at www.forexlive.com.

• Need to see de-escalation with China on tariffs.
• China needs to rebalance.
• If US, China can rebalance together, that would be a big deal.
• Tariffs situation with China will be a multi step process.
• Chinese economy is slowing down substantially, we will likely revisit Trump’s phase 1 trade deal.
• If holiday orders not placed, could be devastating for China.
• We are going to bring down China’s unfair trade barriers, hold China to its prior commitments.
• I am meeting with Japan on trade today.
• Had very good meetings with Indonesian Finance Minister.
• I’m not involved with EU talks now.
• We are going to bring down European digital services taxes.
• Will lessen uncertainty on tariffs every day and every week.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• Deal will allow Trump to negotiate with Russia on a stronger basis
• It can show Russia that there is no daylight between US and Ukraine goals

It took them long enough to get this done, especially after that farce of an episode in the Oval Office. But at least this is now over the hump, though we’re yet to see Russia’s formal position on the overall situation.

This article was written by Justin Low at www.forexlive.com.

The near 3% drop today sees oil poised for a potential decline of over 10% this week with not much reprieve in sight. The previous low in April this year touched $55.15 before a bounce on the tariffs pause. But even then, it hardly resulted in a change in confidence in the oil market. In fact, as things went on one can argue that we’re seeing the developments turn for the worse.

The latest news from Saudi Arabia here doesn’t add much encouragement whatsoever to an already struggling outlook.

With the global economic backdrop set to soften amid tariffs and demand conditions also hit hard by the US-China trade standoff, the fact that OPEC+ continues to push for output increases is just adding a heavy burden to oil prices in the current landscape.

It’s a tough one to weed out and the only saving grace looks to be a turning point on the tariffs front. That will be a key spot to watch for oil, considering it is getting little help elsewhere – in particular from OPEC+ and its members.

This article was written by Justin Low at www.forexlive.com.

The crude oil market experienced a rough month due to Trump’s aggressive tariffs announcement on April 2 that made the market to expect lower demand on the slowdown in the global economy coupled with higher supply as OPEC+ planned to increase production by more than expected.

We saw a strong rebound though on April 9 as Trump paused the reciprocal tariffs for 90 days and the market expected more de-escalation and started to price out the global slowdown. The delay in reaching the trade deals and fresh positive supply news eventually weighed on the sentiment and prices rolled over once again.

Yesterday, crude oil extended the selloff as we got the news that the Saudi officials have told allies that they can sustain a prolonged period of low prices in what sounded like a threat of a price war. The focus is clearly on supply right now, but a non-consensus trade opportunity could be in the cards.

Global ocean container bookings have seen a significant decline since the tariffs announcement with bookings from China to US being down 60%. If Trump eases tariffs, we could experience a covid-like bullwhip effect where all those cancelled orders get rebooked creating a huge surge.

The expectations for strong demand and a rebound in global growth will likely push prices higher and a rally to the 70.00 handle on WTI wouldn’t be surprising. But being a contrarian is not enough because you have to get the timing right.

Michael Steinhardt, a trading legend, once said that ideally you should be able to tell, in two minutes, four things:

• the idea
• the consensus view
• the variant perception
• the trigger event

The trigger event, in my opinion, could be the details of the first trade deal. Markets will derive future expectations from that first deal. I think an average tariff rate of 10% or lower (the lower the better), would be the catalyst for a rally in crude oil prices. The idea would be invalidated in case we get a higher rate of course.

This article was written by Giuseppe Dellamotta at www.forexlive.com.