The comrades at the US Statistical Bureau have worked hard. On Friday, the US announced that July's non-farm payrolls only increased by 73,000, significantly below the market expectation of 110,000. Even more outrageous, employment numbers for May and June were revised down by 256,000, leaving employment figures for May and June at 19,000 and 14,000, respectively. What a mess, what’s going on?
I remember when the June data came out, many offshore netizens were ecstatic. What do they say now?
I stopped believing this data a year and a half ago, but this data still affects the financial markets, mainly influencing the Fed's decision-making. After the data was released on Friday night:
1. The dollar index, which had been strong for several days, immediately plummeted.
US Dollar Index
2. Gold futures came with a piercing arrow, swoosh!
New York Gold Futures
3. The yield on US 10-year Treasury bonds plummeted (Treasury prices soared).
US 10-Year Treasury Yield
These three all point to one thing: the possibility of a Fed interest rate cut has increased. Market traders are re-pricing the two interest rate cuts expected in September and October.
Is the interest rate cut really so solid? I think this matter is somewhat odd; it is a fierce game between the US federal government and the Fed.
Did Powell and the Fed officials not know that the employment data to be announced on August 1 would be significant at the end of July? If they knew, why was the tone of the press conference so tough? The understanding king, day after day, is challenging Powell; they are simply going against the understanding king. Thus, the market is being swayed by such outrageous data and internal games.
Is the US stock market starting to trade on recession?
Nasdaq 100 Index
European stock markets have also leaked… for example, this one that has repeatedly hit new highs recently.
Many people must be confused; the employment data is bad, and the probability of the Fed cutting rates increases? The stock market should be rising, right?
This is just one path; clearly, the funds in the market have taken another path. After a continuous rise for three months, the global capital markets have already shown signs of stagnation at the end of July. This includes AH shares, US stocks, Japanese stocks, South Korean stocks, and European stocks. The reasons for the stagnation are multiple, such as delayed expectations for liquidity easing, tariffs 2.0 seemingly higher than expected, the unresolved US-China 812 issue, substantial profit-taking, and technical correction pressures.
So the global market was already on the brink, and then an extremely outrageous non-farm payroll directly shifted the interest rate cut expectations to recession trading. Therefore, gold and US Treasuries rose together, indicating that global stock markets are facing a downturn, selling stocks to buy gold and US Treasuries.
The team still has spots, we will never let fans explode the cabin! Get on board quickly!
Continuously pay attention: SUI PEPE DOGE SOL ETH PNUT
