Macroeconomic Outlook for Next Week: U.S.-Iran at a Crossroads Again! Non-Farm Payrolls Struggle to Break the Stalemate

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On May 3, U.S. President Trump accused Tehran’s leadership of being disunited, hindering the ability to reach an agreement to end the nine-week conflict that has triggered a global energy crisis. He stated that he could not agree with Iran’s ‘proposals,’ but some traders interpreted this as a negotiation strategy rather than a withdrawal from peace efforts. Additionally, reports of Tehran relaying new proposals to Washington through Pakistan also helped to lower oil prices. Iranian Foreign Minister Zarif stated that Iran is ready to continue diplomatic efforts with the U.S., but added that its armed forces remain ‘highly vigilant.’ WTI crude oil fell nearly 3% on Friday, closing around $103 per barrel, with a weekly increase of about 7%. The S&P 500 index continued its record-breaking rally on Friday, achieving its fifth consecutive week of gains, thanks to strong earnings reports from tech giants. On Wednesday at 20:15, the U.S. will release the April ADP employment figures, followed by the April Challenger job cuts report at 19:30 on Thursday, and the April New York Fed one-year inflation expectations at 23:00 on Thursday. On Friday at 20:30, the U.S. will announce the April unemployment rate, seasonally adjusted non-farm payrolls, and year-on-year/month-on-month average hourly wage growth. The preliminary one-year inflation expectations for May and the preliminary University of Michigan consumer sentiment index for May will also be released, along with the March wholesale sales month-on-month figures. Traders will focus on U.S. employment data next week, particularly the non-farm payroll report on Friday. Analysts predict that the April non-farm employment report will show a solid increase of 60,000 new jobs, with accelerating wage growth, a stable unemployment rate, and an increase in the labor participation rate. According to a Bloomberg survey of economists, private sector employment growth may be even stronger.

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