CANADA DATA: Breadth Of Employment Gains A Positive, Hours A Minus (2/3)
The surprise in the sectoral breakdown was the breadth of improvement across sectors.
- Goods-producing employment rose by 42k (+2k prior), an 8-month best, on a 28k rise in manufacturing (also an 8-month best). The overall goods-producing increase leaves employment in the sector at very slightly positive (+1k) for the year, after being -43k in Jan-Jul.
- Agricultural jobs notably rose the most since January 2022 (+13k).
- Services were more mixed but still positive as a whole (+18k, -67k prior), marking just the 3rd month this year that both services and manufacturing employment rose. In this sense, it could provide some relief for the Bank of Canada that US trade dispute-related weakness is not spilling over too badly into non-trade sectors.
- Wholesale and retail trade employment was the standout services category, falling 21k (worst since April), though healthcare and social assistance employment enjoyed its 2nd best month of the year (+14k) and Professional, scientific and technical services improved to +9k from August's very poor -26k.
- Hours Worked Shrinks: We should point out that aggregate hours worked fell for a 2nd month in 3, by 0.2% M/M, to land at a 4-month low. This leaves quarterly hours worked growth tracking around 0.4%, meaning that unless productivity impresses, Q3 growth is not likely to show a major resurgence after Q2's contraction.
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US: Trump Continues To Struggle On Handling Of The Economy
Donald Trump's presidential approval rating stood at 42% in recent days, with the president getting higher marks for his handling of crime and immigration versus the economy, according to a new Reuters/Ipsos survey.
- Reuters notes: “Trump gets relatively poor marks on his handling of the economy, with 36% of Americans liking his economic stewardship and just 30% backing his handling of the cost of living for U.S. households.”
- Semafor notes: “If elections are a referendum on the economy, President Donald Trump and his GOP allies in Congress have their work cut out for them. Unemployment is rising, tariffs are still biting, and inflation hasn’t yet abated.
Figure 1: % of Americans who Approve of the President’s Handling of the Economy
Source: Reuters/Ipsos
ECB: Macro Since Last ECB: Growth - Mfg PMIs Finally In Positive Territory [2/2]
- As for soft indicators, the August PMIs were mixed by sector relative to July with manufacturing continuing to improve but services unwinding the previous month’s improvement.
- It saw the composite PMI increase 0.1pt to 51.0 for its joint highest since May 2024. Within that, the manufacturing survey increased for an eighth consecutive month to a 38-month high, even if that’s only just back into expansionary territory at 50.7.
- Nevertheless, that’s still showing some relative resilience compared to potential scenarios envisaged under aggressive US trade policy. Press release: “While the pace of expansion ticked up to a one-year high, it remained sluggish overall. The service sector held back overall growth, with output rising only marginally. Nevertheless, for the first time since May 2024, private sector firms reported greater volumes of incoming new work and employment growth was its quickest in 14 months”.
GBPUSD TECHS: Sights Are On The Bull Trigger
- RES 4: 1.3681 High Jul 4
- RES 3: 1.3636 76.4% retracement of the Jul 1 - Aug1 downleg
- RES 2: 1.3595 High Aug 14 and a bull trigger
- RES 1: 1.3590 High Sep 9
- PRICE: 1.3546 @ 16:29 BST Sep 10
- SUP 1: 1.3465/3333 50-day EMA / Low Sep 3
- SUP 2: 1.3315 61.8% retracement of the Aug 1 - 14 bull leg
- SUP 3: 1.3249 76.4% retracement of the Aug 1 - 14 bull leg
- SUP 4: 1.3142 Low Aug 1 and a key support
GBPUSD is holding on to its gains since rallying off the Sep 3 low. The climb has retraced the steep sell-off on Sep 2 and highlights a stronger bullish development. This also suggests the corrective cycle between Aug 14 - Sep 3 is over. Sights are on resistance at 1.3595, the Aug 14 high and a bull trigger. A break would strengthen a bullish condition. Initial support to watch is 1.3465, the 50-day EMA.
