USA Initial Job Claims Drops – USD unchanged

USDJPY, Daily              

The 10K initial claims drop to 265k in the fourth week of December trimmed the 21k surge to 275k in the BLS survey week, leaving claims below the 268k Thanksgiving week figure but well above the 43-year low of 233k in the week of Veteran’s Day. Gyrations likely reflect the usual holiday volatility that stretches from Veteran’s Day (November 11th) through the MLK weekend (January 16th)  and we still interpret the claims trend as tight. Claims are averaging 264k thus far in December after lower prior averages of 252k in November, 257k in October, 254k in September, and 262k in August. The 275k December BLS survey week reading sharply exceeded the 233k November BLS figure, but also overshot prior BLS survey week readings of 261k in October, 251k in September, and 262k in August. Expectations are for a 185,000 December nonfarm payroll rise with upside risk from a tight claims trend, a firm 216k November ADP rise, an oil-led factory rebound and a diminishing inventory headwind that are lifting producer sentiment. We also have a surging stock market, rising consumer confidence, and mild weather through early-December before a late-month cold snap. EURUSD remains around the 1.0450 area, USDJPY back over 116.50 following lows of 116.21 earlier and Cable trades north of 1.2230.

USDJPY is currently trading below 117.00 for the first time in ten trading sessions. The 20 DMA (116.25 area) provided support earlier today following the bullish and upbeat outlook from the BOJ’s “Summary of Opinions”. As ever, the close tomorrow represents the close of the week, month and trading year so where we close then will be of particular interest.


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