Forex Analysis & Reviews: 07.02.2022 - Good US employment data will...

Live Chat

InstaForex Loprais Team - Official participant of the Dakar rally

This section features the most important information about trading with InstaForex. We provide both analysis from leading experts for experienced traders and articles on trading conditions for beginners. Our services will help increase your profit potential.

Become Trader

Account Opening

See also

Trading Conditions

Forex Analytics

Charts

This section is designed for those who are just starting their trading journey. InstaForex educational and analytical materials will meet your training needs. Our experts' recommendations will make your first steps to trading success simple and clear.

Start as Beginner

How to start trading

Useful information

Training and recordings

InstaForex innovative services are an essential element of productive investment. We strive to provide our clients with advanced technical capabilities and make their trading routine comfortable as we are recognized as the best broker in this regard.

Become Investor

PAMM System

ForexCopy System

Passive investments

OYS account

Partnership with InstaForex is beneficial and top-tier. Join our affiliate programs and enjoy bonuses, partner rewards, and the possibility to travel with the team of the world-renowned brand.

Become Partner

Main Page

Partner Area

Advantages for Affiliates

Registration

This section contains the most lucrative offers from InstaForex. Receive bonuses when topping up an account, compete with other traders, and get real prizes even when trading in a demo account.

All Promo Campaigns

Bonuses

Contests

Events

Holidays with InstaForex are not only pleasant but also useful. We offer a one-stop portal, numerous forums, and corporate blogs, where traders can exchange experiences and become successfully integrated into the Forex community.

Full details

Forums

We are in social networks

Forex humour

Forex Portal

InstaForex is an international brand created in 2007. The company provides services for online FX trading and is recognized as one of the world's leading brokers. We have won the trust of more than 7,000,000 retail traders, who have already appreciated our reliability and focus on innovations.

Learn More

History

Why Choose Us

InstaSport

Regulation

Company News

Awards

InstaForex Stars

InstaForex Offline

Headquarters

Key documents

Social Responsibility

InstaForex - Official partner of Dragon Racing

07.02.2022 10:50 AM

Good US employment data will slightly calm the markets

Positive mood prevailed last Friday after the disappointment on Wednesday, which was caused by the negative ADP report on the number of new jobs in the US in January and the collapse of Meta (Facebook) shares amid negative corporate reporting for the 4th quarter. However, optimism is not seen in all markets and not for all.

Let's start with the results of the ECB meeting. The European regulator expectedly left all the parameters of monetary policy unchanged, and so, all the attention of investors was drawn to the speech of the bank's chairman C. Lagarde. She was expected to comment on the Eurozone's inflation growth to the level of 5.1% and what the Central Bank would do in this regard. The ECB President did not specifically say in her speech that rising inflation would lead to a mandatory increase in interest rates, but the tone and high concern about rising inflation was perceived by the market as a signal for an early rate hike.

On this wave, the euro received the strongest support and increased in pair with the US dollar to a local high of 1.1480 on January 14. At the same time, the local stock market was under pressure, which caused the European stock indices to fall. The actual change in mood may put some pressure on European stocks shortly, but not on everything. First of all, the shares of companies in the financial and banking sectors will receive support. The expectation of an increase in the cost of borrowing by the ECB will stimulate demand for these securities, since an increase in rates will lead to an increase in interest on deposits and similar things, generally increasing the incomes of these companies.

The next news is the publication of several new jobs in the US from the Department of Labor. The data turned out to be noticeably higher than the forecast, showing an increase in January by 467,000 against the forecast of 150,000. In addition, the upward revision of December values to 510,000 should be considered positively. And although the unemployment rate rose to 4.0% from 3.9%, it did not have a significant negative impact on the markets.

The US stock market received strong support amid employment figures, which led to a halt in sales and the growth of stock indices. Apparently, these positive sentiments will continue today. This is indicated by the dynamics of futures on the main US stock indices, which are confidently trading in the "green" zone.

Today, important economic data are not expected to be published. But among the events, we can single out the expected speech of the ECB Chairman, C. Lagarde.

Analyzing the current situation, we believe that investors will focus again on the coming corporate reports of companies, and if it is generally positive, it may push up the demand for risky assets and lead to the recovery of stock indices that declined last week. If the situation develops in this way, it will be possible to assume a recovery in demand for commodity assets following the shares of companies, as well as a slight correction in the currency market towards the strengthening of the US dollar. The main reason for this may be the publication of new US inflation data, which may rise again.

Forecast of the day:

The EUR/USD pair is trading below the level of 1.1480 and never got above it. This week's US data on rising inflation may push the pair below this level and lead to a correction to the level of 1.1380.