The US dollar paused its rally again on Tuesday, driven by additional gains in the broader financial markets. But investors might also be cheering disappointing job numbers on Tuesday, which might seem counterintuitive to the average person. So, what is happening on Wall Street?
According to the Bureau of Labor Statistics, the number of job openings cratered to 10.1 million in August, down from a downwardly revised 11.2 million in July. This was also below market estimates of 10.775 million.
Most of the declines in job openings were situated in health care and social assistance (-236,000), services (-183,000), and retail (-143,000).
In addition, BLS data show that 4.2 million Americans quit their jobs in August, relatively unchanged from the previous month. The quits rate was flat at 2.7%.
In other economic data, factory orders were flat at 0% in August, matching economists’ expectations, according to the US Census Bureau. Also, factory orders excluding transportation edged up 0.2%.
Orders for durable goods fell 0.2%, and non-durable goods orders jumped 0.2%.
The LMI Logistics Managers Index rose to 61.4 in September, up from 59.7 in August.
Investors cheered the abysmal data, with the expectation that poor statistics will force the Federal Reserve’s hand and begin to ease monetary policy. Although the US central bank has routinely stated that it will not be cutting interest rates anytime soon, the futures market is betting a rate cut sometime next year.
Meanwhile, the US Treasury market was red across the board, with the benchmark ten-year yield down 6.8 basis points to 3.583%. The one-year bill shed one basis point to 3.964%, while the 30-year bond dropped 4.3 basis points to 3.665%.
The US Dollar Index (DXY), which measures the greenback against a basket of currencies plunged 0.96% to 110.67, from an opening of 111.75. The index is down about 3% this week. Year-to-date, the DXY is still up more than 15%.
The USD/CAD currency pair was flat at 1.3620 at 14:22 GMT on Tuesday. The EUR/USD advanced to 1.26% to 0.9949, from an opening of 0.9825.