As the markets awake from the holiday slumber, several economic releases mark January’s calendar, starting with the much anticipated nonfarm payrolls (NFP) report.
Due for release on January 10, the report issued by the US Bureau of Labor Statistics serves as a barometer of economic health. Reflecting the labour market participation during the last quarter of 2024, the NFP report will provide guidance as to what the direction of the US dollar will be in the short to medium term.
Throwback to previous NFP data
According to November’s NFP figure, the US labour market expanded by 227,000, posting a strong gain from October’s upwardly revised 36,000 number, which was hugely impacted by Boeing strikes and the disruptions caused by Hurricanes Helene and Milton.
Healthcare, which added 54,000 new jobs, leisure and hospitality with 53,000, and social assistance with 19,000 jobs, were the sectors seeing the highest growth. Employment also increased in transportation equipment manufacturing by 32,000, mirroring the return of formerly striking workers.
On the flip side, the retail sector lost 28,000 jobs, while mining, quarrying, oil and gas extraction slowed down. Will these figures be exceeded in December?
A leap back to the present
In anticipation of the official release, analysts at Trading Economics expect the NFP will revolve around 200,000 new jobs for December 2024.
On Tuesday, January 7, EURUSD slipped below the 20-day SMA around 1.03864 despite repeated attempts to break above this stronghold. Tibitraders look forward to the upcoming FOMC Meeting on January 8 for a clearer direction in USD-based Forex pairs ahead of data.
GBPUSD also tumbled into negative territory, below 1.2500 on January 7, on the back of solid US PMI data. The Institute for Supply Management (ISM) reported that Services PMI advanced by 54.1, surpassing the 53.3 vehiculated estimates, up from 52.1.
The US Department of Labor also noted that the number of JOLTS job openings increased sharply, bolting above the forecast 7.70 million to 8.098 million. The upbeat numbers suggest the economy is strong, overshadowing the release of Trade Balance data.
According to the US Bureau of Economic Analysis (BEA), the trade deficit stretched in November, with numbers rolling in at $-78.2 billion, above the figure reported in October, $- 73.6 billion.
At the same time, imports jumped from $339.9 billion to $351.6 billion, marking a 3.4% increase. US exports also followed an ascending trend, increasing by 2.7% to $273.4 billion, from $266.3 billion.
Across the pond, UK retail sales expanded by 3.2% YoY in December 2024, reaching their highest level since March.
Despite the upbeat data, hints about Trump’s tariff policy are more likely to weaken the US dollar rather than bolster it. Yet, towards the end of the trading day, the greenback gained momentum against its peers. It remains to be seen what the NFP will bring.
December 7 was an auspicious day for silver as well, which surpassed the $30.00 psychological level, up 0.38% from the previous day’s close. The white metal seems to have gained its shimmer despite the stronger US dollar.
From a technical perspective, the path towards $31.00 is clear, and an advance higher would not be hindered. It remains to be seen how long this upward movement can sustain. What’s your take? Will you buy or sell XAGUSD CFDs?
Note: All prices and percentages referenced in this article are based on the daily timeframe rates available on the TibiGlobe platform.
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