Take Five: U.S. jobs & an OPEC oil gatheringOctober 1, 2021
Oct 1 (Reuters) – Key U.S. jobs numbers on Friday and an OPEC+ meeting on Monday to review oil output as crude prices top $80 dollars a barrel are top of the agenda for markets as 2021 heads into the homestretch following a bumpy Q3 ride.
Here are the five stories likely to dominate the thinking of investors and traders in the coming week:
In September, the U.S. Fed said trimming monthly bond purchases could be warranted “soon”; Chair Jerome Powell noted it’ll take one more “decent” jobs report to set the wheels in motion – not a “super-strong” one, just one that’s “reasonably good”.
Will Friday’s September nonfarm numbers – the last official jobs report before the Fed’s November meeting – do the trick?
A Reuters poll expects 500,000 jobs were added after August’s massive miss. The Fed’s $120 billion-a-month government bond buying helped the S&P 500 (.SPX) double from March 2020 lows. But tapering and rate hike prospects have lifted U.S. Treasury yields and contributed to the S&P’s 4% drop in September.
Stronger-than-expected numbers might fuel fears the Fed could wind down easy-money policies faster than anticipated, potentially causing more market turbulence.
-“Reasonably good” September jobs starts Fed taper. Is another dud coming? read more
-Surging Treasury yields batter ARK fund amid broad tech selloff read more
2/RATES DOWN UNDER
Rates decisions are due in Australia and New Zealand – two countries separated geographically only by the Tasman Sea but worlds apart on monetary policy.
The Reserve Bank of New Zealand looks set to pull the trigger on Wednesday, with markets all but certain of a quarter point increase in the key rate to 0.5% RBNZWATCH. Governor Adrian Orr and crew were ready to become the first in the developed world to hike in August, but a COVID outbreak coincidingwith the policy meeting scuppered those plans, leaving the Norges Bank to take the honours.
Australia’s Reserve Bank meets on Tuesday and sits at the other end of the hawk-dove spectrum. Despite a red-hot housing market, Governor Philip Lowe threw cold water on markets recently, saying he found it “difficult to understand why rate rises are being priced in next year or early 2023.”
-The great central bank exit begins as Norway hikes rates read more
3/WINTER OF DISCONTENT
Power cuts in China, queues at fuel pumps in Britain, soaring energy prices everywhere.
Headlines resonate with the 1970s – and nowhere more so than in Britain, where the army will help to alleviate a fuel shortage that has led to gaps on supermarket shelves and fights at gas stations. The end of a COVID jobs support scheme means more uncertainty.
For some, a 1970s-style “winter of discontent,” when Britain’s economy was brought to it knees by strikes and power…