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May 15th - According to sources, Turkey has proposed building a $1.2 billion (€1 billion) military fuel pipeline to help meet the energy needs of NATO allies on its Eastern European flank. The sources indicated that the pipeline from Turkey to Romania could cost only one-fifth of other proposed options, including routes through Greece or Romanias western neighbors, but these are more vulnerable to sabotage due to their reliance on maritime transport. Turkeys proposal comes as it prepares to host the NATO summit in July. Sources suggest that Turkey hopes to garner support from its allies for the proposal, which could be decided before or during the Ankara summit.U.S. Energy Secretary Wright: Every barrel of oil the U.S. releases from its strategic petroleum reserve will be replenished.On May 15th, it was reported that India will cooperate with the United Arab Emirates to expand its strategic oil and gas reserves, a significant step taken by the worlds third-largest oil consumer to address the risk of future supply disruptions. According to a statement from the Abu Dhabi National Oil Company (ADNOC), the company will consider significantly increasing its crude oil storage capacity in India, aiming to reach 30 million barrels. The two countries will also cooperate on establishing a strategic natural gas reserve in India and explore the construction of crude oil storage facilities at the port of Fujairah, located outside the Strait of Hormuz. This preliminary agreement was announced during Indian Prime Minister Modis brief stopover in Abu Dhabi en route to Europe.On May 15th, Wang Yi briefed the media on the meeting and consensus reached between the Chinese and US heads of state. During the meeting, the two leaders agreed to define a "constructive strategic and stable relationship between China and the US" as the new positioning of bilateral relations, providing strategic guidance for China-US relations over the next three years and beyond. China believes this should be a positive and stable relationship based primarily on cooperation, continuously enhancing the resilience of China-US relations through exchanges and cooperation. As the worlds two largest economies, cooperation between China and the US benefits both sides, while confrontation harms both. Even if there is competition between China and the US, it should be benign competition based on mutual learning, positive competition where both sides strive to catch up, and fair competition that adheres to the rules. The purpose of competition is to help both sides become better versions of themselves. Both sides should maintain policy continuity and stability, especially upholding their commitments, and always moving towards each other, providing more certainty for their respective development and the international situation through positive expectations of China-US cooperation. In short, a "constructive strategic and stable relationship between China and the US" is not just a slogan, but a goal that both sides uphold and actions that they take together.Market news: Türkiye is reportedly planning to raise $1.2 billion to build fuel pipelines for its Eastern European NATO allies.

What impact does NFP have on the forex market?

LEO

Oct 25, 2021 13:27

Nonfarm payroll employment is a compiled name for goods, construction and manufacturing companies in the US. It does not include farm workers, private household employees, or non-profit organization employees.

It is an influential statistic and economic indicator released monthly by the United States Department of Labor as part of a comprehensive report on the state of the labor market.

The Bureau of Labor Statistics releases data on the first Friday of the month, at 8:30 a.m. Eastern Time. 

This data is analyzed closely because of its importance in identifying the rate of economic growth and inflation.

Nonfarm payroll is included in the monthly Employment Situation or informally the jobs report and affects the US dollar, the Foreign exchange market, the bond market, and the stock market.

The markets react very quickly and most of the time in a very volatile fashion around the time the NFP data is released. The short-term market moves indicate that there is a very strong correlation between the NFP data and the strength of the US dollar. Historical price movement data shows a small negative correlation between the NFP data and the US dollar Index.

The figure released is the change in nonfarm payrolls (NFP), compared to the previous month, and is usually between +10,000 and +250,000 during non-recessional times. The NFP number is meant to represent the number of jobs added or lost in the economy over the last month, not including jobs relating to the farming industry.

As with other indicators, the difference between the actual non-farm data and expected figures will determine the overall impact on the market. If the non-farm payroll is expanding, this is a good indication that the economy is growing, and vice versa. However, if increases in non-farm payroll occur at a fast rate, this may lead to an increase in inflation. In forex, the level of actual non-farm payroll compared to payroll estimates is taken very seriously. If the actual data comes in lower than economists' estimates, forex traders will usually sell U.S. dollars in anticipation of a weakening currency. The opposite is true when the data is higher than economists' expectations.

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