US DATA: A Conflicting JOLTS Report
The JOLTS report saw a second month with lower-than-expected job openings, and this time by a greater extent in March. However, layoffs fell to their lowest since June and quit rates surprisingly inched higher, the latter still low historically but up nearly 0.2pps from November lows. These two conflicting findings should be viewed in the context of the vacancy to unemployed rate still being higher relatively than quit rates.
- Job openings fell to 7192k (sa, cons 7500k) in March after a downward revised 7480k (initial 7568k) in Feb.
- Ratio of openings to unemployed also fell to 1.02 after a downward revised 1.06 in Feb, inching below the 1.03 in September for technically the lowest since Apr 2021.
- It had averaged 1.1 through Jun 2024-Feb, between the 1.2 in 2019 and 1.0 in 2017-18.
- Hire rates continued to plateau in March, with an overall rate at 3.39% having averaged 3.38% in an extremely narrow range since October. This remains below the 3.9% averaged in 2019 and 3.8% averaged in 2017-18.
- Layoffs fell to 1558k in March from 1780k for their lowest since Jun 2024. Government layoffs edged higher to 107k after 100k in Feb (averaged 83k in 2024), indicating only modest attrition compared to more ‘normal’ times whilst federal layoffs fell to 8k after 19k (averaged 6k in 2024).
- Quits rates meanwhile saw what to us was a surprising increase albeit it one exaggerated by rounding, lifting to 2.09% after two months at 2.05/2.04%. It’s the highest quit rate since Jul 2024, having lifted off a recent low of 1.91 in Nov, although are still low historically vs 2.3% in 2019 and 2.2% in 2017-18.
- The increase in quits was driven by the private sector (2.25 to 2.32%) whilst total government quits held at a rounded 0.8% for a fifth consecutive month. Within the latter, federal quits ticks a tenth higher to 0.5% after three months at 0.4%. That included February being revised up from 0.3% initially at what had bene a fresh low since late 2016.
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USDCAD TECHS: Bullish Outlook
- RES 4: 1.4700 Round number resistance
- RES 3: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 2: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- RES 1: 1.4402 High Mar 20
- PRICE: 1.4292 @ 16:50 GMT Mar 28
- SUP 1: 1.4235 Low Mar 26 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD traded through support at 1.4242 on Wednesday but has recovered. A return lower and clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. Moving average studies continue to highlight a dominant uptrend. A reversal higher would refocus attention on the bull trigger at 1.4543, the Mar 4 high. First resistance is 1.4402, the Mar 20 high.
US FISCAL: Debt Limit "Extraordinary Measures" Pick Up, But Cash Dipping Pre-Tax
Treasury data shows that there were $207B of "extraordinary measures" available to circumvent hitting the debt limit as of Wednesday Mar 26.
- That's the most since Jan 27th and up from $163B a week earlier, from a total $376B available.
- However, Treasury cash in the TGA fell to $316B as of the 26th (and was down to $280B on Thursday), meaning there were a combined $523B of resources available to avert the debt limit, the lowest since the impasse began in January (and half of the starting amount of just over $1T).
- The next couple of weeks will be very important for Treasury, as they represent the biggest tax take of the year. The Congressional Budget Office reported this week that per its estimates "if the debt limit [$36.1T] remains unchanged, the government's ability to borrow using extraordinary measures will probably be exhausted in August or September 2025." Treasury wrote to Congress this month that they would be able to provide an update on the x-date in the first half of May, after the conclusion of tax season.
AUDUSD TECHS: Remains Above Support
- RES 4: 0.6429 High Dec 12 ‘24
- RES 3: 0.6414 38.2% retracement of the Sep 30 ‘24 - Feb 3 bear leg
- RES 2: 0.6409 High Feb 21 and a bull trigger
- RES 1: 0.6391 High Mar 17 / 18
- PRICE: 0.6291 @ 16:46 GMT Mar 28
- SUP 1: 0.6258 Low Mar 21
- SUP 2: 0.6187 Low Feb 4
- SUP 3: 0.6171/6088 Low Feb 4 / 3 and a key support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
AUDUSD is unchanged. A short-term bull theme is intact and the latest move down appears corrective. Key short-term support to watch is 0.6187, the Mar 4 low. Clearance of this level would reinstate a bear threat. First support is at 0.6258, the Mar 21 low. A stronger recovery would refocus attention on 0.6409, the Feb 21 high. Clearance of this hurdle would strengthen the bull cycle and resume the uptrend that started Feb 3.
