US Dollar Index is Lower

CURRENCY FUTURES

The U.S. dollar index is lower despite the bullish on balance U.S. employment data, which is a sign of weakness.

back of dollar bill

Producer price inflation in the euro area eased to 41.9% year-on-year in September 2022, which is down from an all-time high of 43.4% in August and slightly below market expectations of 42.0%.

German industrial orders fell by more than expected in September as foreign demand declined, putting Europe’s largest economy on course for a recession. New orders fell by 4.0% on the month on a seasonally and calendar adjusted basis when analysts expected a decline of 0.5% in September.

U.K. construction activity continued to increase in October, but new orders fell for first time since May 2020.

STOCK INDEX FUTURES

Stock index futures are higher following stronger equity markets in Asia.

There was only temporary pressure when the U.S. employment data were released.

Nonfarm payrolls in October increased 261,000 when up 210,000 were expected. However, this is down from the revised figure for September of 315,000.

Private payrolls were up 233,000 when a gain of 200,000 was anticipated.

The unemployment rate increased to 3.7% from 3.5% when 3.6% estimated.

The labor participation rate was 62.2% when 62.3% was predicted.

Stock index futures are performing well for the news.

INTEREST RATE MARKET FUTURES

According to financial futures markets currently, there is a 47.0% probability that the Federal Open Market Committee will increase its fed funds rate by 50 basis points at the December 14  meeting and a 53.0% probability that the rate will be hiked by 75 basis points.

Susan Collins of the Federal Reserve will speak at 9:00 central time.

I anticipate Federal Reserve speakers may walk back some of Fed Chair Powell’s hawkish comments that he made at his FOMC press conference on Wednesday.

 

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