Daily Finance update: NFP scenario analysis; BoE rate hike pushed further out, December OPEC meeting key for inflation

Nick Batsford, CEO of Tip TV, was joined by Zak Mir, technical analyst for Zak’s Traders Café, and Keith Bowman, Equity Analyst for Hargreaves Lansdown, on the Tip TV Finance Show to discuss a central bank overlook, including analysis on the NFP release today and a focus on the incredibly dovish Carney yesterday.

Non-farm payrolls: Gold and GBP at risk of further sell-off

Batsford highlighted FX Street, who noted that the NFP figure is expected to be around the 180k, with the unemployment figure estimated at 5.1%. They continued that the non-farm payroll figure around or above 180k could be enough to push up December rate hike bets, which are currently at 58%. Meanwhile, an NFP number below 180k could trigger a correction in the USD. Bowman added that odds are moving in favour of a Fed rate hike in December, but the move is not guaranteed. He commented that the Fed may feel they made a mistake not moving in September, and now Yellen may have backed herself and the Federal Reserve into a corner for an interest rate rise.

OPEC meeting in December

Bowman outlined that the OPEC meeting in early December is important for both the oil price and global inflation, which seems to be the backdrop to the global economy at the moment. He added that dividend for big oil majors are holding up, for now.

Carney incredibly dovish on ‘Super Thursday’

Batsford highlighted Elliott, who commented that after yesterday’s MPC meeting BoE governor Mark Carney in his press conference noted that, ‘the path for Bank rate implied by market rates has fallen around 40 basis points (since August), such that it only reaches 0.75% in 2017 quarter two’. So now you know, the committee is basing its forecasts on what market traders are telling it. They went on a charm offensive, Mr Carney granting Bloomberg TV an exclusive interview and at 06:15 GMT this morning deputy governor Ms Minouche Shafik gracing BBC Radio 4’s airwaves. Mir believed that the BoE have entirely messed up their interest rate policy, and they have totally changed their opinion from a possible hike at the end of 2015, to possibly no hike until beyond the end of 2016. He concluded that the BoE may be looking to take advantage of a possible policy divergence with the Fed, if the latter do indeed hike interest rates in December, but ultimately have provided the UK with the worst forward guidance that anyone could give.

Tags: NFP, Gold, GBP, Unemployment, Interest Rates, rate hike, USD, Fed, Federal Reserve, Yellen, OPEC, Oil, inflation, global economy, Carney, MPC, BoE, Bank of England, UK, US, forward guidance