NFP strong enough to advocate rate hike: Societe Generale
By FXStreet FXStreet (Delhi) – Kit Juckes, Research Analyst at Societe Generale, suggests that the recent US nonfarm payrolls data was strong enough to advocate September lift-off but the only caveat being whether the markets remain calm between now and September the 17th.
Key Quotes
“Friday’s US labour market data were strong enough to justify a September rate hike, but the possibility of a move hinges to a significant degree on whether markets are calm between now and the 17th.”
“There’s a risk of some short positions in commodity-sensitive and emerging market currencies but on the whole, we remain bullish of G3 vs the rest and within G3, more bullish of the dollar and the yen than we are of the Euro.”
“The US figures told a familiar story. Wage growth ticked up to 2.2%, 2.5% on a 6-month annualised basis. Employment growth remains at 2.1%, and if you add wage growth and employment growth together, subtracting the core personal consumption deflator, you get a solid 3.1% increase in real income, plenty to keep the US economy trundling along at a decent pace, but perhaps not enough to offset the effect on many commodities and commodity-exports, of the Chinese slowdown.”
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Source:: FX Street
