US economic events-

The dollar index closed with a percent gain last week manages to settle slightly above 50Wsma.

  • Total nonfarm payroll employment increased by 156,000 in September
  • The unemployment rate was little changed at 5.0 percent

Review:

  • In the week ending October 1, the advance figure for seasonally adjusted initial claims was 249,000, a decrease of 5,000 from the previous week’s unrevised level of 254,000. This was the lowest level for this average since December 8, 1973 when it was 252,250.
  • The NMI registered 57.1 percent in September, 5.7 percentage points higher than the August reading of 51.4 percent. This represents continued growth in the non-manufacturing sector at a faster rate.
  • Private sector employment increased by 154,000 jobs from August to September.
  • The September PMI registered 51.5 percent, an increase of 2.1 percentage points from the August reading of 49.4 percent.

UBS-Slowing, but still-healthy payroll gains may be a sign that the slack in the labor market has dissipated, and job growth remains strong enough to either lower the unemployment rate or raise the participation rate. That higher unemployment and participation rates in September may give ammunition to those at the FOMC who believe that the labor force can continue to expand—as such it lessens pressure for an immediate November rate hike. At the same time, the labor market continues to improve, and we see today’s figures as consistent with our expectation for a rate hike in December.

Preview: In the week ahead, market participants focus on today’s US presidential debate (midday AEDT), Wednesday’s FOMC meeting minutes and Friday’s September retail sales.

A couple of Fed speakers scheduled to speak during this week.

Markets participants closely observe to the minutes for the next rate hike clues.

 

Weekly basis:

USDCHF- gains 0.6% but facing resistance at 50Wsma

USDCAD- gains 1.3% settles above 50Wsma

USDJPY- gains nearly 1.7% rejected at 20Wsma