March 25, 2021 | by sandeep
5 Issues to Look Out for this Week – 29/3/21
By Mateo Jarrin Cuvi
Plenty of action this coming week courtesy of one of our favorite economic indicators, the US’s Non-Farm Payroll (NFP) on Friday. Plus, it’s April Fool’s Day on Thursday, so we hope this guide will stop you from being pranked by the market.
NFP: Yeah You Know Me!
It’s your favorite Friday of the month!
Yes, the US’s latest employment figures will be released on Friday, April 2nd at 13:30 GMT via the NFP.
Overall, employment has been rising in the US but a majority of the hirings have been in hospitality, retail, leisure and healthcare, the sectors that have been hit the hardest by the pandemic.
In February alone, 379 thousand jobs were added to the fray, an almost 180 thousand gain from what analysts had expected for the month.
Despite these obvious improvements, the true unemployment rate remains at around 10% with about 10 million less people employed as compared to before the COVID-19 crisis.
Nevertheless, there are signs of hope for a quick turnaround.
Following the approval of the Biden administration’s $1.9 trillion stimulus package, the American employment sector is expected to be back on track by early 2022.
What will this month’s NFP have in store for us?
Whatever it is, don’t pass up on this opportunity to trade USD!
A Snail-Paced Growth for Canada
Canada’s GDP has been slowly moving forward, showing a growth of 0.9% during November and December of last year and recording eight straight months of expansion following two catastrophic months in March and April of last year.
More specifically, December saw a growth of only 0.1% spurred primarily by the wholesale trade, energy, mining and construction sectors.
Interestingly enough, the Canadian real estate market is experiencing a massive boom with both the demand and prices for residential property reaching all-time highs.
Statistics Canada explains: “With an 8.5% jump in December, activity at the offices of real estate agents and brokers more than offset the previous two monthly contractions to reach an all-time high as continued strong home resale activity across the country fueled the growth.”
Still, according to the country’s central statistical office, “total economic activity [remains] about 3% below February’s pre-pandemic level .”
Will this snail-paced rate of growth continue in January?
The Canadian dollar is one of our traders’ favorite currencies, so if you’re not trading it already, this Wednesday is the ideal day to get started.
Keep an eye out for Canada’s GDP announcement on March 31st at 13:30 GMT and trade!
Vroom! Volkswagen Aiming at Electric Vehicle Supremacy
Deutsche Bank reported last week that VW’s electric vehicle (EV) business could be worth a whopping $230 billion.
This is a sum that is significantly larger than the entire company’s current value.
Volskwagen has been making rapid strides in the EV sector with its ID.4 on sale in Europe, the US and China and the delivery of its first twelve ID.4 Crozz assembled in collaboration with China’s FAW Group.
Additionally, the German auto giant earlier revealed plans to build six battery gigafactories across Europe to cater to their electric vehicle plans.
According to Car and Driver, these factories, which are “part of VW’s plan to gain more control over its supply chain,” will boost the company’s plan to produce “one million electric vehicles a year by 2023 and 1.5 million a year by 2025.”
As a result of this combo of factors, the company’s stock is at its highest point since 2009, helping power the DE30 (DAX) index to historic highs.
Tag along for the ride on your favorite VW model (the old-school Beetle for us) and trade DE30 this week as it continues to gain from these developments!
Oil Goes as China Goes. Sometimes
Did you know that China’s Purchasing Managers Index (PMI) oftentimes has a significant impact on the price of oil?
For instance, if manufacturing is strong in China, the world’s largest energy importer, then oil prices tend to move up.
Figures for February showed a slowing down of China’s economy with its PMI dropping from 51.3 in January to 50.6.
Still, as reported by Reuters, the country’s manufacturing sector has benefited greatly from “robust exports, pent-up demand and government stimulus.”
Despite this slight contraction, oil prices continued pushing upwards and welcomed the month of March with WTI up by 15% and Brent by 17%.
So grab a cup of coffee and pay close attention to China’s PMI figures for March, which will be released on Wednesday, March 31st at 2 am GMT.
Oil might move up or down as a result, making this is a unique chance to trade your favorite commodity!
A Full Recovery is on the US’s Cards
Following nine solid months of growth despite the pandemic, will the ISM Purchasing Managers Index (PMI) for March show even greater expansion for the USA?
February witnessed some nice gains for the ISM PMI as it rose from 58.7 to 60.8%, showing that the US economy is well on its way to a full recovery following months battling COVID-19.
According to ISM’s Chair, Timothy R. Fiore, “manufacturing performed well for the ninth straight month, with demand, consumption and inputs registering strong growth compared to January.”
Fiore added that “labor-market difficulties” will “[continue] to restrict manufacturing-economy expansion and will remain the primary headwind to production growth until employment levels and factory operations can return to normal across the entire supply chain.”
If the PMI comes out strong when announced on April Fool’s Day, the American dollar might push upwards, making it a primetime opportunity to trade USD.
So tune in on Thursday, April 1st at 3:00 pm GMT to find out!
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*Any opinions, news, research, analyses, prices or other information contained here are provided as general market commentary and do not constitute investment advice. FXPRIMUS does not accept liability for any loss or damage, including without limitation to, any loss of proﬁt, which may arise directly or indirectly from the use of or reliance on such information.