US Dollar's recovery lost some momentum with weaker than expected job data. ADP report showed 156,000 growth in private sector jobs in April, much worse than the expected 205,000. US trade deficit shrank to -40.4b in March, smallest in over a year. Non-farm productivity dropped -1.0% in Q1 while unit labor costs rose 4.1%. Two Fed officials spoke yesterday that a June rate hike is a “real option”. However, it seems as though the markets are not buying this view. Fed fund futures are only pricing in 11% chance of rate hike in June. And, there's only 55% chance priced in for December hike.
Elsewhere, UK had another weaker than expected PMI today. Construction PMI dropped to 52.0 in April much lower than expected. Eurozone retail sales dropped -0.5% mom in March. Eurozone services PMI was revised down to 53.1 in April.
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