In the UK, the unemployment rate rose less than expected

On Monday, share prices rose slightly amid stabilization of government bonds yield. US Treasuries retreated from the 1.70% level and are 2 basis points lower. Today, the attention of investors will be fixed on the joint speech of Janet Yellen and Jerome Powell in the US Congress. As expected, politicians will express their previous opinion on the need to support the economy by maintaining a soft monetary policy.

This morning, the Office for National Statistics reported that UK unemployment rose less-than-expected during the quarantine as the government's dismissal program saved workplaces. The number of people looking for job opportunities rose from 11,000 to 1.7 million, bringing the unemployment rate to 5%. Economists had expected the rate to be 5.2%. The number of employed people decreased by 147 000 people.

The forecast for the growth of unemployment has changed. The fourth-quarter unemployment rate is now expected to be 6.5%, but not 7.5% as it was specified in the November forecast. This is also well below the peak of recessions in previous decades, despite the fact that the economy experienced its deepest recession in three centuries last year.

Meanwhile, new restrictions are being introduced in Germany. Chancellor Angela Merkel and regional leaders have agreed to introduce a new lockdown during Easter celebrations to try to counter the third wave of Covid-19.

According to the plan, all stores will be closed from April 1 for five days, with the exception of grocery stores, which will open on April 3. Citizens will be encouraged to stay at home, private gatherings are limited to one household and a maximum of five people. Public gatherings are prohibited.

Against this background, oil prices continue to remain under pressure, losing just over 1% at the opening of trading in the Asian session. S&P 500 futures decreased after a slight increase on Monday.

Main market quotes:

S&P 500 (F) 3,921.38 -8.62 (-0.22%)

Dow Jones 32,731.20 +103.23 (+0.32%)

DAX 14,657.21 +36.21 (+0.25%)

FTSE 100 6,726.10 +17.39 (+0.26%)

USD Index 91.983 +0.242 (+0.26%)

Important events:
  • – UK Average Salary Level including bonuses (Jan) at 09:00 (GMT+2);
  • – United Kingdom Claimant Count Change (Feb) at 09:00 (GMT+2);
  • – United Kingdom CBI Industrial Trends Orders (Mar) at 13:00 (GMT+2);
  • – Federal Reserve Chair Jerome Powell’s speech at 16:00 (GMT+2);
  • – US New Home Sales (Feb) at 16:00 (GMT+2);
  • – FOMC Member Brainard’s speech at 16:00 (GMT+2).

by Justforex, 2021.03.23

We advise you to get acquainted with the daily forecasts for the major currency pairs.

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

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