Friday’s jobs report was a big disappointment for market participants, hence, Dollar was sold off sharply against both developed and developing markets’ currencies. The Dollar index is currently trading at 94.1, down -4.6% YTD.
Focus for today is on FED chair Janet Yellen, who is scheduled to speak at 16:30 GMT. However, three of her colleagues has spoken since the jobs report, let’s take a look at what they had to share –
- Speaking after the jobs report, Cleveland FED President Loretta Mester, who is a voter this year, said, FED should raise rates gradually, despite weaker jobs report. “I still believe that in order to achieve our monetary policy goals a gradual upward pace of the funds rate is appropriate,” According to her, U.S. economy is moving in right direction and weaker job numbers don’t alter that. He cited recent strikes in information sector to be behind the number. She warned that FED can’t focus on the financial market too much in deciding monetary policy.
- In a separate event, Fed Governor, Lael Brainard, who is also a voter this year called for caution and wait out for more data before going for a rate hike. “The data in today’s labor market report on balance suggest that the labor market has slowed,……..Nonfarm payroll employment increased at an average monthly pace of 116,000 over the last three months–well below the 220,000 per month average pace over the preceding twelve months.” She said that she wants to have greater confidence in domestic economy. According to her, Brexit poses risks to U.S. economy.
- Boston FED President Eric Rosengren said that FED is still in hiking path, however, acknowledged that recent data have been choppy and job number weak. He thinks it will be important to see if this weak report is an anomaly or reflects a broader slowdown. “It is my expectation that economic conditions will continue to gradually improve, which in turn would justify further actions to normalize policy, continuing a gradual return to a more normal interest rate environment.”
The material has been provided by InstaForex Company – www.instaforex.com