6 Mar 2015
US sees strong labour, moderate wage growth – SG
FXStreet (Barcelona) - Sebastien Galy of Societe Generale, comments on the impact on Fed, EM and Euro post the strong US labour data release.
Key Quotes
“The US labour market is tightening much faster than expected but without much signs of wage growth. Irrespective of this the big repricing of the Fed's reaction function is on the way, sooner maybe a tad faster as the Fed catches up. This creates gyrations in the back end of the UST10s but it meets demand from investors desperate for yield.”
“EM is going through a flat faced formation, commodities (e.g. Gold) following and G10 usd should resist far better ex commo (CAD, AUD).”
“Once the shock has finished percolating through, risk aversion will steadily ebb away leaving the Fed's path far clearer and a world bereft of yield in any size outside of the US.”
“EM will eventually be popular after a horror trip, the potential of the USD vs G10 should moderate.”
“EURUSD 1.05 on the way.”
Key Quotes
“The US labour market is tightening much faster than expected but without much signs of wage growth. Irrespective of this the big repricing of the Fed's reaction function is on the way, sooner maybe a tad faster as the Fed catches up. This creates gyrations in the back end of the UST10s but it meets demand from investors desperate for yield.”
“EM is going through a flat faced formation, commodities (e.g. Gold) following and G10 usd should resist far better ex commo (CAD, AUD).”
“Once the shock has finished percolating through, risk aversion will steadily ebb away leaving the Fed's path far clearer and a world bereft of yield in any size outside of the US.”
“EM will eventually be popular after a horror trip, the potential of the USD vs G10 should moderate.”
“EURUSD 1.05 on the way.”