US NONFARM PAYROLLS SET TO DRIVE MARKETS

A deluge of economic data will make its way through the financial markets on Friday, with US nonfarm payrolls set to take centre stage.

The Labor Department’s nonfarm payrolls report is arguably the most closely watched calendar event of the month. The release provides a snapshot of hiring trends in the world’s largest economy, including a summary of unemployment, hours worked and average wage growth. Together, these data sets provide a pulse of the US economy.

The June report, which is due at 12:30 GMT, is expected to show the creation of 179,000 jobs last month. On Thursday, payrolls processor ADP said private-sector employment rose by 158,000 last month.

The unemployment rate is forecast to hold steady at 4.3%. Average hourly earnings – a proxy for inflation – is expected to climb 2.6% annually.

North of the border, Canada will also release its latest employment figures at 12:30 GMT. The world’s eleventh-largest economy quietly emerged as the G7’s fastest-growing nation in the first quarter. Its employers have also added workers for six consecutive months, raising the specter of a rate hike at the Bank of Canada’s forthcoming meeting.  

Traders can expect several other important releases throughout the European session. At 06:00 GMT, the German government will report on industrial production for the month of May, where output is forecast to grow 0.3% month-on-month. That translates into an annualized gain of 4%.

The French government will also produce the latest trade and industrial output data on Friday.

Meanwhile, the United Kingdom’s Office for National Statistics will report on industrial production, manufacturing production and trade – all for the month of May.

Oil prices were off to a rough start Friday, as a period of volatility continued in the final session of the week. US crude prices traded below $45.00 a barrel in the Asian session, while Brent crude fell to the $47.50 region. Later in the day, traders can expect a weekly rig-count report from oilfield services provider Baker Hughes Inc.

EUR/USD

The euro broke out of its week-long funk on Thursday, with prices returning above 1.14 US. The EUR/USD is eyeing 14-month highs near 1.1450. A failure to set a new high in the near term could leave prices rangebound as the dollar looks to regain momentum.

USD/CAD

A stronger domestic economy and calls for a rate hike have pushed the Canadian dollar to multi-month highs. However, the loonie has run into resistance as of late, as traders awaited fresh market catalysts. Those catalysts are likely to come in the form of jobs data on Friday.

WTI OIL

Crude’s technical outlook has deteriorated sharply in recent hours, with prices falling below key technical supports. Prices are now exposed to last month’s swing low, a move that would undo a momentous eight-day rally through US Independence Day.