Employment, before the Twitter storm

Posted by: Paul Donovan

06 Mar 2020
  • The US employment report is a much revised data release – but traders like it. (Inaccuracy of data should not stand in the way of a trader's desire to overreact). Today's data will cover the consequences of the China shutdown for the US (which should be limited), but comes before the Twitter storm promoting fear of the coronavirus in the US.
  • US Fed Presidents Williams and Kashkari spoke overnight. Williams can lay claim to be the voice of economic leadership on the Fed. Unfortunately, the messages seemed suspiciously scripted – the rather inept rate cut was an insurance policy, to sustain the recovery. We hear from Fed Presidents Mester and Evans later today.
  • German factory orders for January were stronger than expected. German production was hit by falling demand for investment goods, caused by fear and uncertainty around US President Trump's trade taxes. That fear peaked late last year, allowing investment to stop getting worse. Sadly, we now have a new fear to focus on.
  • Chinese trade data will be produced over the weekend – covering January and February so as to smooth out the Lunar New Year effects. Clearly, this will be hit by the extended production shutdown.

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