As President Trump’s global trade war wreaks havoc with US manufacturing, reverberations in the labour market are already being felt. Jobless applications are up, last month’s NFP reading showed a 60% drop from the month before, and the FED is being forced to react. Based entirely on the jobs’ situation vis-à-vis manufacturing, construction and goods, the Non-Farm Payrolls report ignores seasonal employment, freelancers and domestic workers. It is a fair reflection of the level of employment dedicated to pure production, and thus will certainly react to the current geo-political situation. With the G20 fiasco behind us, clearly prosperity is not around the corner. And looking ahead, the Federal Reserve is going to finally be forced to succumb to the Commander in Chief’s monetary wishes. A July rate cut is now nearly a given, the remaining question being the extent – a quarter percent or a half. Watch Friday’s report and the Dollar prepare to price in the next FED decision.
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