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Forex Flash: US shifting focus back to monetary policy and labor market - Commerzbank

By FXstreet.com,  January 03, 2013, 05:47:00 AM EDT

FXstreet.com (Barcelona) - Market focus will shift from the fiscal cliff back to US monetary policy with today's ADP report on the US labour market, although the majority of analysts do not consider the ADP report to have much forecasting ability. "Thanks to the explicit target for the unemployment rate (continuation of the zero rate policy until unemployment rate 2.5%) the numerical result gains new significance - even if the actual level of 7.7% is still a long way away from this target", wrote Commerzbank analyst Ulrich Leuchtmann, adding that the FOMC has been very unclear about the conditions of ending QE3.

Investors will be seeking for information regarding additional measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments, apart from inflation and employment. "Fed Chairman Ben Bernanke did not contribute anything more specific to this rather vague description during the press conference on 12th December", said Leuchtmann, pointing out that that's what will make today's minutes interesting, possibly helping to better understand the Fed's policy in this respect.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Forex and Currencies

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