Fed Chief Powell’s testimony to Congress and the US non-farm payrolls report are the two key announcements that investors globally will be glued to.
The Fed and a big jobs report could drive the market this week, as investors keep an eye on interest rates. One of the biggest events this week is Fed Chief Powell’s testimony before Congress. Investors will be paying careful attention to Fed Chair Jerome Powell’s testimony when he appears before the Senate Banking Committee on Tuesday and the House Financial Services Committee the following day. Powell will be speaking on the Fed’s attempts to combat inflation.
On Monday, March 6, factory orders will arive while Consumer credit data is due on Tuesday, March 7.
The U.S. Bureau of Labor Statistics will release reports on February’s Nonfarm Payrolls, Labor Force Participation Rate, and Unemployment Rate on Friday, March 10. Traders around the world will be keeping an eye on the US non-farm payrolls report for hints on whether the economy can withstand further rate increases.
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The US labour market continued to be resilient, according to data released last week, backing the Fed’s decision to continue its tightening policy, which was the driving force behind nearly all major assets falling in value in February.
Investors will be particularly interested in knowing whether the massive job growth from January persisted in February. According to the Labor Department, the U.S. economy added 517,000 jobs in January, greatly above forecasts and causing the market to reassess precisely how high the Federal Reserve will raise interest rates in order to reduce inflation.
Since then, the number of individuals claiming unemployment benefits has continued to be low, raising hopes that the figures for February will show another massive increase in employment next Friday. If this happens, the Federal Reserve may be forced to raise interest rates even more aggressively.
Meanwhile, the yield on the 10-year Treasury note briefly surpassed the 4% barrier last week, and investors will be keeping an eye on how stocks respond to more alluring risk-free returns in the bond market, with many anticipating it to rise even higher. As of now, both equity and debt (short-term) are delivering to investors.
Elsewhere, Asia investors are keeping a close eye on Beijing’s National People’s Congress for any additional policy pronouncements and details that might establish the tone for how permissive or restrictive government’s regulations will be through 2023. On Tuesday, attention will be focused on Australia’s interest rate decision, and on Friday, it will be the final one made by Bank of Japan Governor Haruhiko Kuroda.
After a good start in January, stocks ended February lower thanks to higher for longer rate regime remarks by several Fed officials. How March pans out for investors remains to be seen as global markets have an important week ahead with several key events and announcements lined up for investors to consider.