The market prepares for the US jobs report; Lagarde says the euro zone recovery is still fragile-business facts | business

Good morning, and welcome to our rolling report on the world economy, financial markets, the Eurozone and business.

Arguably the most important data release for global investors this month, U.S. Employment Report, Looming in the market today.

Non-agricultural employment data for June Yes expected Jobs increased by approximately 690,000 jobs last month (although forecasts vary), up from 559,000 in May, and the unemployment rate fell from 5.8% to 5.7%.

As the reopening of the economy helps raise wages, wages are expected to increase by 0.4% this month, an increase of 3.7% from last year.

Investors will pay close attention to the data to find new clues as to how long the Fed will change its monetary policy and begin to reduce its stimulus plan, which slows the flow of cheap money into the market.

A strong employment report will increase confidence in the strength of the U.S. recovery… and a weak report may indicate that the company is working hard to recruit employees.

Yesterday, the number of new Americans applying for unemployment benefits hit a pandemic low-highlighting the strength of the job market.

But as Jim Reid of Deutsche Bank Point out that due to Covid-19, more than 7 million jobs are still missing:

US economists at DB expect non-agricultural employment to increase by 700,000, which in turn, they expect this will help reduce the unemployment rate by one-tenth to a post-pandemic low of 5.7%.

Of course, even with an increase of 700,000, this will still make the total number of non-agricultural employment lower than the level of February 2020-6.9 million, so there is still some way to go before we return to the normal state before Covid. But before the report was released, we had a good weekly report on the number of first jobless claims. As of the week of June 26, the report fell to a post-pandemic low of 364,000 (expected to be 388,000).

Wall Street hit a record high this week… Ipek Ozkadesskaya, Senior Analyst Swissquote, Saying that traders are looking for a strong number.

Given the steady decline in weekly unemployment claims, we expect to see a strong number, but it remains to be seen whether it will exceed 700,000.

The market clearly needs a strong data to maintain its optimism, because the unexpectedly weak employment data will not make the Fed take more action, as inflation is hovering at a worrying 5%, and it is not even certain that this is a peak. In addition, another important thing here is average income, which is expected to rise to 3.7% in June from 2% a month ago-to cope with inflationary pressures.

The fact that many people are now getting new jobs in an environment of rising inflation makes wage growth steeper. Of course, if oil prices eventually fall to ease inflation, then higher wages will continue to exist.

Oil is also on the agenda because OPEC+ Ministers will meet today to discuss whether to increase production.Yesterday’s meeting was postponed United Arab Emirates The plan to increase by 2 million barrels per day (bpd) in the second half of this year was rejected.

The deadlock may cause oil-producing countries not to increase production at all, Bloomberg says, Back to the terms requiring production to remain stable until April next year.

yesterday, Brent Crude oil prices hit their highest level since October 2018, rising by US$76 per barrel because even if demand continues to improve, supply will remain tight.

However, it is currently slightly lower, with a drop of 0.25% so far this trading day, which was approximately US$75.65 before the meeting.

Agenda

• BST 10 am: Euro zone producer price inflation index
• 1.30pm: US unemployment report in June
• 3pm British Summer Time: US May factory orders