UK employment, BoC and Yellen’s testimony amongst market movers today – Rabobank

Michael Every, Senior Asia-Pacific Strategist at Rabobank, suggests that ahead of the Janet Yellen show today we have UK unemployment, where jobs growth is seen as healthy once again and the ILO unemployment rate should stay at 4.6%.

Key Quotes

“In line with the general trend, average weekly earnings are seen declining from 2.1% y-o-y to just 1.8%.”

“In Europe we get to see industrial production, expected up 1.0% m-o-m and 3.5% y-o-y, and India releases both CPI and industrial production data, the former expected to moderate further to just 1.7% y-o-y and, more regrettably, the latter to do the same.”

“Then it’s ‘Yellen at Congress’ time, where there may be some yelling back in the Q&A given concerns over the Fed’s plans to keep hiking and roll-back QE ahead. There is little point in speculating on what more she may say ahead of the event, so let’s just wait and see what she does and how the market reacts.”

“The Bank of Canada also has a rate decision to make today, and the markets are expecting the first 25bp rate hike –taking us up to 0.75%- since late 2010. While that is probably priced in after the surprising shift towards hawkishness of late, it will be interesting to see how much more tightening is suggested. If it’s ‘one and done’ for now, expect buy the rumour sell the fact. Naturally, any contrast between the FOMC and BoC positions today may provide room for some movement in USD/CAD.”