EUROPEAN SESSION
In the European session, we don’t have much on the agenda other than a couple of low tier releases like the final Eurozone Q1 GDP report and Italian Retail Sales. The data is not going to change anything for the ECB, so the market reaction will likely be muted.
AMERICAN SESSION
In the American session, we have the Canadian Employment report and the US NFP. The Canadian data is expected to show 10K jobs added in May vs -17.7K in April, and the Unemployment Rate to remain unchanged at 6.9%. Most of Canadian data has been surprising to the downside which led traders to pare back the hawkish bets. There’s now just 46% chance of a rate hike by year-end.
The US NFP is expected at 88K vs 115K in the prior month, and the Unemployment Rate to remain unchanged at 4.3%. The Average Hourly Earnings Y/Y is expected at 3.4% vs 3.6% prior, while the M/M metric is seen at 0.3% vs 0.2% prior. The NFP, and especially the CPI, are likely to influence the tone at the upcoming FOMC meeting.
The US jobs data has been consistently surprising to the upside pointing to a stable and even re-accelerating labour market. The Fed projected a 4.4% unemployment rate in 2026, so we are already below that. Their attention has shifted to inflation as that’s the part of the mandate more in tension now
