Overnight the Nikkei followed the US equity markets Friday performance and rose 0.8%. US equity markets rose following the better than expected payrolls figures. The US added 303k jobs compared to an expected 214k and the unemployment rate fell from 3.9% to 3.8%. Earnings growth - a potential inflation driver - continued to moderate, falling from 4.3% to 4.1%.
The People's Bank of China kept the yuan reference rate within its recent range in the daily fixing on Monday. Eyes are on the currency as it nears the PBOC limit for depreciation. China has acted aggressively when the limit has been reached in the past. The move has been caused by the combined factors of USD strength following reduced expectations for USD rate cuts and a generally weak economic picture in China. Gold keeps pushing to new highs, currently sitting at $2335 after reaching $2353 overnight.
The shiny rock rallied following the NFP data on Friday afternoon. Oil fell over 1% on the start of trading after middle east tensions failed to flare up over the weekend. There had been fears Iran would attack Israel or Israeli assets following an Israeli strike on an Iranian consulate in Syria last week. It's a busy week for data. Some of the highlights are German industrial production today, US FOMC minutes and CPI on Wednesday, an ECB rate decision on Thursday and German/French/Spanish CPI on Friday.
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