US Jobs Report and Inflation Data Set to Drive Market Sentiment
The US employment report for September is expected to be a major focus of attention this week, as market consensus sits at 84,000 (max/min estimate range between 180,000 and 35,000), with the unemployment rate seen holding at 4.1% (max/min estimate range between 4.2% and 4.0%). The Fed recently revised its unemployment projections lower to 4.1% until 2029.
The August PCE inflation numbers will also be released on Wednesday, which will set the tone for inflation. Outside the US, the RBA will update its rates on Tuesday, followed by the Australian CPI inflation print on Wednesday, and then the September eurozone CPI inflation data on Friday.
US Treasury yields have surged across the curve, with 10s north of 5%, 30s touching highs of 5.5%, and 2s closing in on 5%. US real yields are now at levels not seen since late 2008. Despite this, US equity benchmarks largely shrugged off the move.
The USD has been rallying as global capital flows into the greenback to capture risk-free yield, leaving the USD index testing highs not seen since late July.