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The UK jobs data indicated uncertainties over the resilience of the economy. Traders await inflation data from Canada. The US President Joe Biden will be meeting with Kevin McCarthy, Republican House of Representatives Speaker, on how to deal with the current debt ceiling issue.
GBPUSD strengthened against a subdued dollar despite downbeat jobs data from the UK. Average earnings including bonuses were unchanged at 5.8% in March while earnings excluding bonuses came in at 6.7%, which is 0.1% less than estimates. The Claimant count change which measures the number of unemployed people rose to 46.1K in April taking the unemployment rate to 3.9% from 3.8%.
The data may prompt the BoE to slow down rate hikes due to a trickle-down effect on consumer spending. Looking ahead to the New York session, the US retail sales data will be due along with industrial production data and a line of Fed speak. A failure to keep above 1.2500 may reinforce selling pressure to 1.2450 and 1.2400 while a breach above 1.2550 may give buyers 1.2600 and 1.2700.
AUDCAD traded 0.20% south ahead of the Canadian inflation data. Inflation in the country is expected to ease a bit in April ahead of the BoC June policy meeting. The Aussie weakness was inspired by dovish RBA meeting minutes and downbeat Chinese economic data. The RBA board agreed on a 25bps hike or a pause in the upcoming meeting in June.
The National Bureau of Statistics of China showed that the economy grew less than anticipated in April. Retail sales came in at 18.4% vs 21.0% surveyed while industrial production settled at 5.6%. The pair may extend its slump to 0.8950.
EURZAR rallied by +0.53% in the aftermath of mixed economic data from the Eurozone. The Euro area Gross Domestic Product expanded by 1.3% as anticipated in the first quarter on a year-on-year basis. ZEW economic sentiment in Germany dropped to -10.7 vs -5.3 in May while the ZEW current conditions went up to -34.8 against an estimate of -37.0. In South Africa, the unemployment rate rose at a slower pace than forecast at 32.90% vs 33.20% expected. Further upside traction is currently capped at 20.80. A move above may give buyers 20.94 and 21.00.
European stocks traded lower as investors maintained a cautious mood in the European session. The UK 100 was down -0.06% below 7800 sitting at a low at 7760. CAC40 lost -0.24% after opening with a gap lower trading between 7428 and 7375. DAX in Germany was flat at -0.01% as bulls struggled to break above 16000.
US stock futures were quite subdued as investors await debt ceiling updates. The US 500 futures were down -0.08% ranging between 4120 and 4140. US 30 futures tanked -0.20% capped by 33 350 and supported by 33 200. US 100 futures traded flat at -0.0% as 13 500 remains a headwind to the upside.
Additionally, crude oil prices slid, riding on downbeat data from China ahead of the US API weekly crude oil stock. The UK oil was down -0.61% as bulls hung on the $76.00 high. A break below $75.00 may give sellers $72.00. US WTI fell -0.36%, caught between $71.75 and $70.50.
