The latest Non-Farm Payroll data from the US is due out this week, Mads Koefoed, Head of Macro Strategy at Saxo Bank, believes that July will probably be another “solid” month for the US labour market. Expectations are for somewhere above 200,000 extra jobs, but not as high as the results in June. Better ADP figures and positive jobless claims do suggest a more positive trend. The ADP figures showed 218, 000 extra private sector jobs and jobless claims falling below 300,000. Regarding the unemployment rate, Mads Koefoed expects the number to stay unchanged at around six percent.

We saw a stronger GDP report for the second quarter at four percent annualised. The consensus expectations had been around three percent, so a better result than expected. According to Mads Koefoed, the outcome was primarily driven by personal consumption growth. Residential investments also made a come-back after a weak first quarter; blamed on bad weather. Government spending also showed a rise, up 0.8%. For several quarters in a row government spending had been declining.

As for the timing of rate rises, Mads Koefoed says that while the often-heard “considerable amount of time” turn of phrase indicates a continuing dovish approach by the FOMC, it’s worth noting that there was a slight hawkish tone, based on a slightly firmer notion from one regional president within the FOMC urging a rate rise sooner.