Daily Market Report - 07/03/2016


The U.S. dollar fell on Friday hitting one-week lows against the euro on Friday after a drop in U.S. wages in February overshadowed strong jobs growth and supported views that the Federal Reserve was in no hurry to hike interest rates. Average hourly earnings fell 3 cents in February, data from the Labor Department showed.
The market focused on the drop in wages even as nonfarm payrolls increased by 242,000 jobs last month, far outstripping forecasts and the previous month’s release. The dollar was set to post its first weekly decline against the euro in three weeks. The drop in U.S. wages suggested that inflation remained muted. Fed policymakers are watching inflation closely in their assessment of when to continue hiking rates.


China's yuan firmed against the dollar for a fourth day after the central bank fixed a stronger midpoint on Friday, while suspected intervention by the central bank also lent support. Recently state banks such as ABC and ICBC have been constantly intervening in the currency market to support the yuan. Agricultural Bank of China (ABC) and Industrial and Commercial Bank of China (ICBC), two of the major state-owned banks, typically engage in activities to keep the yuan stable on behalf of the central bank.

Key Announcements

15:30 – USD: Labour Market Conditions Index for February expected to remain in line with last month’s release of 0.4
20:00 – USD: Consumer credit change for January expected to decrease to USD 16bn from USD 21bn