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Alpha Trade Liquidity The market knows it early


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Good morning, Alpha Trade Liquidity:

The dollar has once again steadily fallen against G10 currencies as US data weakened further, as well as against gold, which is now in a unilateral downward trend as gold prices reached a 13-month high.

The weaker-than-expected JOLTS data and the drop in job openings to the lowest level since May 2021 have panicked the market, and dovish interest rate bets are priced in, with the market expecting the Fed to either raise rates or pause at its next meeting.

The sharp drop in job openings has weighed on stocks, and this tone remained as European markets opened.

Also shocking the market was the New Zealand central bank's announcement of a 50 basis point rate hike and said it would raise rates further to get inflation back to target. The unexpected rate hike made the New Zealand dollar a standout among G10 currencies.

The backdrop of New Zealand's rate hike is that the New Zealand economy is heading for recession, and housing data released during the session also showed that house prices fell 10% year-on-year, the largest drop on record, making the decision of the New Zealand central bank even more difficult to understand.

Asia-Pacific stocks were mixed, with the NZX50 index giving up gains after New Zealand's rate hike.

The dollar index is just above 101.50 and is trying to return to 102. The euro is just above 1.0950 and the pound is just below 1.2500.

There are several US data releases coming soon, including ADP data, international trade data and the ISM services purchasing managers index. The data will be closely watched, and market makers want to study the data to predict the path of US interest rate hikes.

Regarding the ADP private sector employment data, the market expects the US to add 200,000 jobs in March, compared with 242,000 in February.

Meanwhile, for the much-watched ISM services purchasing managers index, the market expects it to fall to 54.5 in March from 55.1 in February, and the ISM employment index, prices paid index and new orders index will also fall compared with previous months.

There is no doubt that the disappointing data will cause the US dollar to fall, and the New Zealand dollar and gold will be the main beneficiaries.

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