The U.S. dollar took a nose dive this week, driven lower by rising positive global risk sentiment. Expectations of a Biden Presidential win but a Republican controlled Senate lowered the odds of big changes in government policy (i.e., reducing the fear of tax hikes), and the possibility of more fiscal stimulus had traders running towards risk and away from the dollar all week.
United States Headlines and Economic data
Monday:
IHS Markit U.S. Manufacturing PMI improved slightly to 53.4 in October from 53.2 in September
ISM Manufacturing PMI improved in October to 59.3 from 55.4 in September
Tuesday:
U.S. factory orders rise solidly by 1.1% m/m in September vs. 0.6% previous; outlook uncertain – a slowdown is anticipated as government support for those affect by COVID-19 is set to run out.
Dr. Scott Gottlieb warns of a ‘sustained period’ in the U.S. of 1,000 Covid deaths per day – The average number of currently hospitalized Covid-19 patients is up by at least 5% in 40 states and the District of Columbia, according to a CNBC analysis of data from the Covid Tracking Project.
Wednesday:
With U.S. presidential election too close to call, Biden bats away Trump victory claim
U.S. Private payroll growth slows in October, well below expectations – “Companies added 365,000 positions for the month, according to ADP, well below the 600,000 estimate from a Dow Jones economist survey.”
U.S. Business activity expands at fastest pace since April 2015
ISM Services PMI: 56.6 in October vs. 57.8 in September.
Presidential election race remained cloudy and the likelihood of gridlock in Congress made investors optimistic that major policy changes would be difficult to enact. This perceived reduction in uncertainty coupled with the possibility of a new round of stimulus before the end of the year is likely why we saw risk taking behavior across the financial markets throughout the week.
Thursday:
2020 October Job Cuts Report: 80,666 Cuts as Employers Grapple With Uncertainty – October’s total is 32% lower than the 118,804 cuts announced in September. It is 60% higher than the 50,275 cuts in the same month last year.
Initial jobless claims: 751K last week vs. 758K the week prior – “Continuing claims — or the total number of Americans claiming ongoing state unemployment assistance — fell by 538,000 to 7.29 million in the week ended Oct. 24”
U.S. daily coronavirus cases top 100,000 for the first time
Friday:
U.S. Job growth stronger than expected in October, unemployment rate slides to 6.9%
- Nonfarm payrolls increased by 638,000 in October vs. a forecast of 530,000 by economists surveyed by Dow Jones
Final U.S. wholesale inventories for September was up 0.4% m/m to $638.5B
White House in reach for Biden as he takes leads in Pennsylvania, Georgia
