US Dollar Mixed As Pace of Historic Layoffs Slows Down

The US dollar is mixed against its G10 currency rivals on Thursday after new labor data suggests the pace of the historic layoffs in the aftermath of the coronavirus pandemic appear to have slowed down. All eyes will be on the Thursday jobs report, and analysts are anticipating 21 million lost jobs. Have investors already priced in a devastating reading into the broader financial markets?

According to the Department of Labor, initial jobless claims hit 3.169 million for the week ending May 2, down from the previous week’s reading of 3.839 million. The market had forecast 3.05 million Americans applying for unemployment benefits.
Continuing jobless claims surged 22.6 million, while the four-week moving average, which removes the week-to-week volatility, clocked in at 4.173 million.
This comes one day after ADP reported that private-sector payrolls cratered by 20.2 million in April, worse than the median estimate of 20 million. The service sector accounted for most of the losses (16 million), particularly leisure and hospitality (8.6 million). In March, private businesses terminated 149,000 positions. The April reading is the biggest decline in the US labor market.
In other labor-related data, non-farm productivity in the first quarter tumbled 2.5%, down from the 1.2% jump in the fourth quarter. Unit labor costs surged 4.8% in the January-to-March period, up from the 0.9% boost in the previous quarter.
On Wednesday, the Mortgage Bankers Association (MBA) reported that mortgage applications ticked up 0.1% for the week ending May 1. This is up from the 3.3% drop a week ago.
The April jobs report will dominate business headlines on Thursday as economists project an unemployment rate of 16% and more than 21 million lost jobs.
The US Dollar Index, which measures the greenback against a basket of currencies, slightly advanced on the news. The index rose 0.05% to 100.14, from an opening of 100.21, at 12:57 GMT on Thursday. It is on track for a weekly gain of more than 1%.
The USD/CAD currency pair tumbled 0.5% to 1.4075, from an opening of 1.4147. The EUR/USD dipped 0.01% to 1.0794, from an opening of 1.0795.

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Original from: www.earnforex.com