Market Drivers – US Session, March, 6

More softening of the US employment market supported the growing likelihood of a rate decrease by the Fed in June, which further undermined the value of the dollar. Meanwhile, gold reached all-time-high, around $2,150 per ounce, as a result of more gains, and the EUR/USD pair broke above 1.0900 during the North American session.

Following dismal data, and Chair Powell’s first testimony, the dollar fell to multi-week lows and pulled the USD Index (DXY) down to lows of 103.00s.

Economic Data

Private sector employment in the US increased by 140,000 in February, according to the Automatic Data Processing (ADP) report released on Wednesday. This figure represented a rise from the revised January number of 111,000 (previously reported as 107,000), but fell short of market expectations, which had anticipated a gain of 150,000 jobs.

Weekly Initial Jobless Claims are due on March 7. Chief Powell’s second testimony and Balance Trade data are also due on the same day. L. Mester of the Fed is also scheduled to speak.

Key Developments

The GBP/USD pair managed to break above the 1.2700 barrier and chart fresh tops, always amidst increasing weakness in the US Dollar and encouraging news from the Spring Budget.

USD/JPY retreated to the boundaries of the 149.00 mark, or three-week lows, amidst the extra decline in US yields and the intense move lower in the Greenback. On March 7, weekly Foreign Bond Investment figures are due, seconded by the speech of BoJ Nakagawa.

The EUR/USD pair advanced north of 1.0900 the figure to print fresh six-week tops on the back of a persistent dollar selloff. The ECB meets on March 7, followed by the usual press conference by President C. Lagarde. ECB is expected to leave rates unchanged for the fourth time in a row and publish fresh economic forecasts.

In line with the remainder of the risk-associated assets, AUD/USD rose markedly and approached the key 0.6600 hurdle. In the Australian docket, Balance of Trade results, Home Loans, and Investment Lending for Homes readings are next on March 7. 

WTI printed decent gains and briefly surpassed the key $80.00 mark per barrel on the back of a smaller-than-expected weekly build of US crude oil inventories and rising bets of a Fed’s rate cut later in the year.

Also Read:

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