What happened
US employment data exceeded expectations. 184,000 jobs were opened in the private sector in March, above the forecast of 148,000, according to economists consulted by Reuters. The numbers point to the continued strength of the US labor market, giving more reasons for the Fed (Federal Reserve, the American Central Bank) to be cautious about the beginning of the interest rate cut.
The market is now waiting for more comprehensive numbers. The release of the more specific ADP report anticipates the payroll, which will be released by the US Department of Labor on Friday (5).
Investors also echoed the Fed president’s speeches. Jerome Powell acknowledged that the latest data points to solid growth and a strong job market, but reinforced that the Fed still has time to deliberate on the first interest rate cut. “While this progress is welcome, the work of restoring inflation to [meta de] 2% is not yet completed”, he pondered.
High oil prices raised alarms and could impact interest rates in the US. The price of a barrel of Brent crude approached US$90 after Ukrainian attacks on Russian refineries and amid a possible escalation in the war between Israel and Hamas. “What is holding the Fed back from cutting interest rates? It’s inflation. With oil on the rise, the scenario gets worse,” Hideaki Iha, operator at Fair Corretora, explained to Reuters.
After working upwards until 11 am and testing the R$5.10 region – a price that has not been seen since October 2023 -, the American currency turned around and closed the day falling. The main reason was the speech of [Jerome] Powell, which weakened the dollar against other currencies and brought relief to the US interest rate curve.
Leandro Petrokas, research director and partner at Quantzed
Tags: Dollar falls R5 .04 employment data Stock market falls
