It was a busy day for the currency markets yesterday. The German factory orders report showed that output increased 2.6% on the month beating estimates of a 1.1% increase. Previous month’s revisions showed a revised print from a 2.5% decline to just 1.6%.
In the NY trading session, the ADP payrolls report showed that the economy added 177k jobs in June. This was below the median estimates of 190k. Data for May was revised higher to show 189k jobs.
The services sector measured by ISM showed an increase to 59.1 on the index. This beat estimates by a strong margin and activity was seen rising from May’s 58.6.
Later in the evening, the FOMC meeting minutes were released. The minutes showed that officials were concerns about letting inflation run too hot. Members print from a 2.5% decline to just 1.6%.were seen widely agreeing that further rate hikes were needed. The markets did not react much to the release of the Fed minutes.
Looking ahead, the U.S. and Canada jobs report will be coming out today. Canada’s employment change is expected to show 20.4k jobs being added. This marks a bullish print which could potentially trigger the BoC to likely hike rates once again. The Canadian unemployment rate is expected to remain steady at 5.8%.
In the U.S. the payrolls report is expected to show that the economy added 195k jobs on the month, marking a slower pace compared to the 223k jobs added the month before. The U.S. unemployment rate is expected to hold at 3.8% and the wage growth is forecast to rise 0.3% on the month.
