PREVIOUS TRADING DAY EVENTS 08 June 2023

Announcements

The number of Americans filing new claims for unemployment benefits jumped to the highest in more than 112 years as per the report last week, giving a big surprise to the markets. The actual figure showed 261K more claims versus the lower and expected 236K. The U.S. dollar had lost ground. The spike in weekly jobless claims raised traders expectations of the Fed actually pausing rate hikes.

The jump in claims could be a sign of a pickup in layoffs, but given the volatility of claims from weektoweek, it is too soon to reach that conclusion, said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.

The narrowness of the increase in claims by the state is a further factor suggesting we should wait for additional confirmation before concluding layoffs have picked up, especially given the fraud in Massachusetts recently.

Recent Labor Market Data for the U.S. have been indicating that the market is still strong and exhibits remarkable resilience. NFP data showed a high positive change in employment while the unemployment rate increased slightly. However, with no further statements from policymakers regarding interest rates, the Federal Reserve is expected to keep its policy rate unchanged next Wednesday for the first time since March 2022.

Claims remain well below our estimate of 305,000 to be consistent with no monthly job growth, and it will take a more sustained increase in the level of…