In the European session, ECB and BoE officials are scheduled to speak, but no changes in their current positions are expected. During the American session, key reports will be released, including US Durable Goods Orders, the final Q1 GDP, and US Jobless Claims. Durable Goods Orders are generally volatile and usually do not have a strong impact on the market. GDP data is often seen as outdated and does not significantly influence market decisions, which focus more on future expectations.

US Jobless Claims

Jobless Claims data is a crucial indicator of the labor market and provides up-to-date insights on employment trends. If the labor market shows clear signs of weakening amid rising inflation expectations, the Federal Reserve might consider rate cuts. Initial Claims are forecasted at 245,000, while Continuing Claims are expected to reach 1,950,000. However, some factors may affect these numbers, such as seasonal increases in claims during the summer and challenges in finding jobs due to economic uncertainty. Recent increases in Continuing Claims might not just indicate layoffs, but also difficulties in re-employment. Important speaker times in GMT include BoE’s Breeden at 08:30, ECB’s de Guindos at 09:45, and ECB’s Schnabel at 11:00. Fed and ECB officials will also speak later in the day. This text describes several economic events happening today. Although European central bank officials will speak, their views are expected to remain unchanged. They are likely to repeat what they have said in the past. Consistency from leaders like Breeden and de Guindos has become the norm, and markets seem to have adapted to their positions. Attention then shifts to the United States in the afternoon, where several important data points will be released. While Durable Goods Orders are on the agenda, their unpredictable nature means that many market participants may overlook them. This dataset often undergoes revisions and experiences sharp monthly changes, making the initial release less relevant. As a result, markets might ignore the headline entirely.

Market Focus and Policy Implications

The final reading of Q1 GDP will also be released, but the market already has a clear idea of what this will show. Since it reflects the state of the economy from months ago, it acts more as a historical reference than a guide for the future. By release time, investors are often more focused on current indicators. More important is the Jobless Claims data. Weekly claims provide a timely snapshot of employment trends. Predictions for initial claims hover around 240,000, with continuing claims expected to approach two million. While these figures are higher than previous months, they aren’t necessarily alarming by themselves. Context is important. An increase in the number of individuals relying on jobless benefits suggests difficulties in the labor market. There are seasonal trends during late spring and early summer that typically push claims higher—stemming from education, tourism, and contracts ending. This time period often introduces temporary distortions in labor market data, making it tricky to determine if the numbers represent short-term noise or a meaningful shift. If there are several weeks of rising continuing claims, especially without significant layoffs, it may indicate that workers are struggling to find new jobs. These updates are crucial when considering policy expectations. Fed Chair Powell and colleagues are already closely examining the labor market, and any substantial weakening could lead to changes in central bank policies. If inflation expectations rise but job data begins to weaken consistently, trade-offs will become more evident. As policymakers speak throughout the day, their statements are likely to be cautious. Schnabel and de Guindos will likely stick to known positions. However, slight changes in their wording can still influence market pricing, though shifts in tone typically reflect cumulative signals rather than isolated comments. For those who rely on short-term rates and volatility, it’s essential to stay alert for significant data shifts, even in a calm consensus environment. Since rates influence decisions on leverage, market positions should prioritize clarity over uncertainty. While Durable Goods and GDP data create background noise, labor market data—whether clear or messy—should be the main focus. Create your live VT Markets account and start trading now.

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