U.S. Weekly Initial Jobless Claims were 238k, slightly above the 235k estimate. This was the 4th consecutive week of claims above 230k after averaging roughly 215k weekly claims the prior six months. It’s a new trend that will take on increasing significance if it carries claims closer to 261k, the most recent 3-year high.
Continuing Claims reached 1858k, the second consecutive 30-month high following the previous 1832k, now clearly in breakout territory.
The third piece of labor data today is ADP Employment change which was 150k for June, below the 165k estimate and 157k previous. ADP is the precursor to Friday’s Change in Nonfarm Payrolls, the key reading on unfolding labor conditions in the U.S. The estimate for June Nonfarm Payrolls is 190k. Anything below 165k will set a new low for the year and below 146k would mark a fresh multi-year low. So the stage is set for Friday, with potential to be a volatile day, compounded by low liquidity given the Independence Day holiday.
Factory Orders plummeted in May, -0.5% vs. +0.2% estimate.
The U.S. Dollar Index is -0.34% today at 105.36, distancing itself from the recent 106.13 high set only a week ago. Dollar declines: -0.30% vs. NOK, -0.20% vs. EUR & GBP, -0.15% vs. CAD, -0.13% vs. AUD, and -0.08% vs. CHF.
U.S. Treasury yields are sharply lower following the labor and Factory Order data with the mid-term tenors seeing the biggest price increases. The 6-year yield is leading with a 0.074 basis point decline.
Lower yields are driving flows into gold (+1.43%) and silver (+3.39%).
