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ADP Non-Farm Employment, Final Services PMI, Fed’s Powell Speaks

calendar 03/04/2024 - 08:04 UTC

The US dollar gave back a small piece of its recent gains against most major currencies on Tuesday, retreating from six-week highs against the euro, with the dollar index (USDX) ending the session 0.17% lower. The move comes despite positive reports from the US, where the Labor Department released a report indicating that job openings edged up while investors also assess a February increase in factory orders. In the meantime, market focus shifts towards upcoming key employment figures due from the US, with the Non-Farm Payrolls release on Friday being the highlight of the week.

Comments from Fed’s chairman Jerome Powell will most likely be watched closely for possible hints on the Fed’s monetary policy plans following earlier statements that the central bank is in no hurry to lower borrowing costs and after data showed a key measure of inflation rose slightly in February. Bets for a June rate cut are up once again on Wednesday, reaching 61.8% according to the CME Fedwatch tool, from 56% seen in the previous session.

In Wall Street, sentiment appears weakened for yet another session, with the US30 extending its downward move by another 0.72% with the overall decline this week exceeding 2%. Part of the move could be attributed to pressures deriving from the health sector as well as a big jump in Treasury yields amid remarks from several Federal Reserve officials highlighting the need to refrain from lower rates for the time being.

In corporate news, Tesla reported its first-quarter delivery numbers, falling short of the expectations set by analysts with the stock price declining by almost 5% after the news. The EV giant delivered 386,810 vehicles against the estimated 449,080, according to Bloomberg. In addition, competitor Rivian Automotive stock also fell 5% after the company trailed analyst consensus for first-quarter production numbers.

For Wednesday, some price action could be observed upon the release of the eurozone unemployment rate, the ADP non-farm employment change, US services PMI’s, crude oil inventories by the Energy Information Administration and speeches from several Fed members including Fed president Powell.


The EUR/USD pair managed to regain some of its recent losses and bounced off multi-week lows after the release of a better-than-expected final estimate for Eurozone Manufacturing PMI on Tuesday.

In U.S. data on Tuesday showed new orders for U.S.-manufactured goods came in more than expected in February, while U.S. job openings held steady at higher levels.

Eurozone HCOB Manufacturing PMI data showed a rise to 46.1 in the final revision for March when economists had expected no-change from the 45.7 flash estimate. Although it was higher than expected it is still not above the 50 which distinguishes growth from contraction, unlike US Manufacturing PMIs which rose above 50 for the first time since 2022.

According to data released on Tuesday, German Harmonized Index of Consumer Prices slowed to 2.2% YoY in March from 2.4% in February, which was below the 2.3% expected.



Gold scaled yet another record peak on Tuesday ending the session 1.38% higher as market participants snapped up the safe haven asset amid growing Middle East tensions, largely ignoring a stronger dollar and tempered bets for U.S. rate cuts.

Risk appetite was dealt a fresh blow on Wednesday after an earthquake in Taiwan battered the island’s infrastructure and its top chipmaking factories, while also sparking Tsunami warnings in parts of Japan.

The mix of bullish tailwinds has driven bullion nearly 10% higher so far this year.



Oil prices settled higher on Tuesday after a session in which Ukrainian attacks on Russian energy facilities and escalating conflict in the Middle East pushed the Brent benchmark above $89 a barrel for the first time since October.

Moreover, Iran vowed to retaliate against Israel, which it blames for a attack on an Iranian consulate in the Syria on Monday. The threat has stoked fears that Iran could be dragged into the Israel-Hamas war and spark wider conflict in the oil-rich Middle East region.

The weekly U.S. supply data due later this week will also provide further clues on supply-demand imbalance, with the U.S. expected to report a drawdown in weekly inventories.


US 500

The three major U.S. stock indexes fell on Tuesday and the yield on benchmark 10-year Treasuries hit a four-month high after data showing strong labor demand raised the prospect that the Federal Reserve could delay cutting interest rates.

Data on Tuesday showed new orders for U.S.-manufactured goods rebounded more than expected in February, while U.S. job openings held steady at higher levels. Fears of higher-for-longer interest rates saw Wall Street indexes tumble from near record highs in the past two sessions.

Tesla shares dropped after the electric car maker posted fewer quarterly deliveries for the first time in nearly four years.

US 500

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