Investors will shift their focus from Putin to Powell in the week ahead when the Federal Reserve Chair testifies before lawmakers Wednesday and Thursday for clues in his remarks on how geopolitical risk could impact the central bank’s path forward on lifting interest rates. Traders will also tune in to the Labour Department’s February jobs report Friday for the latest snapshot on the U.S. job market recovery.
Russia’s foray into Ukraine and punishing sanctions on the country and President Vladimir Putin by Western allies have whipsawed markets in recent days and sent prices on oil and other commodities soaring, raising worries of even sharper inflation and other economic disruptions across the globe.
On the unemployment front, traders are expected to get the latest read on the Labour Department’s all-important jobs report on Friday.
U.S. payrolls recorded a stunning jump in January despite a record number of Americans calling in sick from work as the Omicron variant spread rapidly across the country at the start of the year. Non-farm payrolls surged by 467,000 for the month in a major upside surprise from the 125,000-250,000 experts expected.
February’s figures are likely to reflect continued momentum in the labour market’s recovery, with economists surveyed by Bloomberg estimating 400,000 jobs were added during the month.
While an improving labour market is good for U.S. households, the trend again reverts attention back to the Federal Reserve. Widespread job openings have made room for significant leverage for workers, driving wage gains higher and further elevating inflationary pressures. Average hourly earnings grew by 5.7% on a year-over-year basis in January.
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