Global macro overview for 08/09/2017:
The first negative effect of Hurricane Harvey is seen on the US job market. The recent Unemployment Claims data were substantially worse than expected. Market participants anticipated a slight increase in the number of the unemployed people in the US from 236k to 245k, but he number revealed was at the level of 298k. It was the highest reading since April 2015 while it was the largest weekly increase since 2012. The numbers of claims in Texas rose by over 50k on the week to above 63k. Continuing Claims data in the week ending August 26th were released at 1.94mln from 1.95mln and has remained below 2.00mln for over four months.
Before the storm, the Unemployment Claims figures had been consistent with an improving labor market picture, but the Hurricane Harvey will cause swings in broader US economic data. Employment may be depressed initially until rebuilding and recovery efforts in flooded areas around Houston take hold.The biggest impact in job market might be noticed in qualified workers sector as this particular part of US job market had kept the underlying trend in claims applications low. On the bright side, post-Harvey reports on manufacturing and services highlighted a solid demand for labor, which might, in turn, underpin consumer spending (the biggest contributor to the US GDP).
Let's now take a look at the USD/JPY technical picture on the H4 time frame. The market has hit the important technical support at the level of 107.53 despite the fact it is trading in oversold conditions. This level might be a key level for the bulls, so it is worth to keep an eye on any impulsive rebound towards the nearest technical resistance at the level of 108.27 and above. No signs of bullish divergence are present yet.
