Market Awaits For Important Economic Indicators

US Jobs Report Takes The Center Stage

US labor market conditions has always played a vital role in the Fed Reserve’s monetary policy decision and has been closely monitored to decide when it would begin slowing the pace of its $85 billion monthly bond-buying program.

Wednesday’s Upbeat ADP numbers fueled expectations of a stronger reading from Friday’s jobs report, reinforcing the ideas that the Fed might move to cut back its massive stimulus measures as early as December. Further, considering the uncertainty over the timing of the Fed scaling back its economic stimulus program, investors keenly await for the release of the most critical, closely watched and top economic indicator from the US, monthly jobs report for the month of November, popularly known as Non-farm payrolls (NFP).

The US Labor Department is scheduled to release its monthly jobs report for the month of November on Friday. The jobs report is expected to show an addition of 184,000 new jobs in November, down from 204,000 jobs in October, while the unemployment rate is seen dipping to 7.2% from 7.3%.

Preceding Friday’s jobs report, ADP report, that provides an estimated change in the number of people employed in private-sector and is viewed as a guidance to the official monthly jobs report, was released on Wednesday. According to ADP National Employment Report, released on Wednesday, the US economy added 215,000 new private-sector jobs in November, the highest in 2013 and better than consensus forecast for 172,000 jobs addition. The October reading was also revised higher to 184,000 new jobs versus an initial estimate of 130,000 jobs.

Coupled with the recent upbeat US economic indicators, a positive surprise from Friday’s NFP data would reinforce expectation of the Fed stepping closer to begin tapering the stimulus in December and could trigger accelerated gains for the US Dollar.

Focus on US GDP, ECB and BoE

In the meantime, investors will monitor the revised US GDP numbers for the third-quarter, scheduled for release later on Thursday. The third-quarter US GDP figure is expected to revised up to show an expansion of 3% annualized rate from a 2.8% growth estimated in the advance release, supporting an optimistic view of the US economic recovery.

Markets, on Thursday, will also be focusing on monetary policy decision from European Central Bank (ECB) and Bank of England (BoE) and their forward guidance based on the overall economic assessments. Following a surprising cut in its key lending rate to 0.25% in November, ECB is widely expected to keep their benchmark interest rates unchanged. Meanwhile, in view of the upbeat economic indicators from the UK, markets are not expecting any policy action from BoE either. For Technical Outlook read: Technical Overview – EURUSD, GBPUSD, AUDUSD

Original Article: Admiral Markets