The number of job openings on the last business day of June stood at 7.43 million, the US Bureau of Labor Statistics (BLS) reported in the Job Openings and Labor Turnover Survey (JOLTS) on Tuesday. This reading followed the 7.71 million openings (revised from 7.76 million) recorded in May and came in below the market expectation of 7.55 million.
“Over the month, both hires and total separations were little changed at 5.2 million and 5.1 million, respectively,” the press release read. “Within separations, quits (3.1 million) were little changed while layoffs and discharges (1.6 million) were unchanged.”
Market reaction to JOLTS Job Openings data
The US Dollar (USD) Index preserves its bullish momentum and was last seen rising 0.35% on the day at 99.00.
US Dollar PRICE This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Euro.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 1.91% | 0.82% | 0.61% | 0.40% | 1.11% | 1.13% | 1.11% | |
| EUR | -1.91% | -1.09% | -1.23% | -1.48% | -0.78% | -0.76% | -0.78% | |
| GBP | -0.82% | 1.09% | -0.32% | -0.40% | 0.30% | 0.34% | 0.31% | |
| JPY | -0.61% | 1.23% | 0.32% | -0.21% | 0.44% | 0.50% | 0.63% | |
| CAD | -0.40% | 1.48% | 0.40% | 0.21% | 0.67% | 0.74% | 0.71% | |
| AUD | -1.11% | 0.78% | -0.30% | -0.44% | -0.67% | 0.03% | -0.01% | |
| NZD | -1.13% | 0.76% | -0.34% | -0.50% | -0.74% | -0.03% | -0.02% | |
| CHF | -1.11% | 0.78% | -0.31% | -0.63% | -0.71% | 0.00% | 0.02% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
This section below was published as a preview of the US JOLTS Job Openings data at 09:00 GMT.
- The US JOLTS data will be watched closely ahead of the release of the July Nonfarm Payrolls report on Friday.
- Job Openings are forecast to edge lower to 7.55 million in June.
- The state of the labor market is a key factor for Fed officials when setting interest rates.
The Job Openings and Labor Turnover Survey (JOLTS) will be released on Tuesday by the United States (US) Bureau of Labor Statistics (BLS). The publication will provide data about the change in the number of Job Openings in June, alongside the number of layoffs and quits.
JOLTS data is scrutinized by market participants and Federal Reserve (Fed) policymakers because it can provide valuable insights into the supply-demand dynamics in the labor market, a key factor impacting salaries and inflation. Job Openings have been declining steadily since reaching 12 million in March 2022, indicating a steady cooldown in labor market conditions. In January of this year, the number of Job Openings came in above 7.7 million before declining to 7.2 million by March. Since then, JOLTS Job Openings rose for two consecutive months, reaching 7.76 million in May.
What to expect in the next JOLTS report?
Markets expect Job Openings for June to decline to 7.55 million. Although concerns over an economic downturn eased after the United States (US) reached trade agreements with Japan and the European Union (EU), there is still uncertainty surrounding the inflation outlook. Hence, Federal Reserve (Fed) policymakers could refrain from easing monetary policy unless labor market conditions worsen in a noticeable way.
The CME FedWatch Tool shows that markets virtually see no chance of a rate cut at the upcoming July 29-30 Fed policy meeting. Nevertheless, a significant negative surprise in the JOLTS Job Openings data, with a reading below 7 million, could feed into expectations for a 25-basis-point rate cut in September, which currently has a probability of about 60%. In this scenario, the US Dollar (USD) could come under pressure with the immediate reaction.
On the other hand, a reading near the market consensus, or better, could help the USD to hold its ground. Regardless, investors could opt to stay on the sidelines ahead of the Fed policy announcements on Wednesday, not allowing the data to have a long-lasting impact on the USD’s valuation.
When will the JOLTS report be released and how could it affect EUR/USD?
Job Openings will be published on Tuesday at 14:00 GMT. Eren Sengezer, European Session Lead Analyst at FXStreet, shares his technical outlook for EUR/USD:
“The near-term technical outlook points to a buildup of bearish momentum in EUR/USD. The Relative Strength Index (RSI) indicator on the daily chart declined below 50 and the pair broke below the 20-day Simple Moving Average (SMA), currently located at 1.1700.”
“On the downside, the 50-day SMA aligns as the immediate support level at 1.1560 before 1.1450 (Fibonacci 23.6% retracement of the February-July uptrend) and 1.1335 (100-day SMA). Looking north, resistance levels could be spotted at 1.1700 (20-day SMA), 1.780 (static level) and 1.1830 (end-point of the uptrend).”
Employment FAQs
Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.
The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.
