Markets Relatively Steady Awaiting US NFP Report
The main currency pairs are trading in a narrow range today, as investors are cautious before the US tariffs on Chinese imports start operating today. The United States will begin charging tariffs for Chinese goods worth $34 billion today at 12:01 am in Washington (04:01 GMT) and now all attention has shifted to how China will respond.
The markets are also focused on data on the US labor market, which will be released today. Non-farm payrolls (NFP) are projected to have grown by 200K last month, slightly down from 223K in May. The unemployment rate isn’t expected to change but could remain on hold at 3.8%, the lowest level since April 2000. The average hourly earnings are expected to rise by 0.3% in June, which is in line with last month’s figure.
The minutes of the Federal Reserve’s latest policy meeting on June 12-13, released on Thursday, showed, that the Fed is not concerned about the rising threat of a trade war or other economic disruptions. The Fed members judged that the economy is “very strong” and inflation is “expected to run at 2% on a sustained basis over the medium term”.
On the monetary policy outlook, the members generally agreed that it would be “appropriate to continue gradually raising the target range for the federal funds rate to a setting that was at or somewhat above their estimates of its longer-run level by 2019 or 2020”.