US Unemployment Claims Surpass Previous Record

The AUDUSD opens at 0.6044 and the NZDUSD opens at 0.5912 this morning.

Unemployment claims overnight blew out their recent record, coming in at 6648K. You know this will be the new normal when conventions changes to report it as 6.6M… The worry here is with such a surge in claims, this number is probably underreporting due to a backlog, and has by no means peaked. The actual unemployment rate for March is out overnight, and expect a pretty poor number, though it will really be next months number that highlights the slowdown. During the GFC, unemployment peaked at around 10%, but sadly it is probably going to be the Great Depression that we will soon be benchmarking against.

Oil has been another big story overnight, with Trump jumping on Twitter to announce that he expects Russia and Saudi Arabia to agree on a 10M barrel per day cut in oil. This sent oil up 25% before selling off slightly. The positive here, is that it was the rout in oil three weeks ago which sent everything spiralling. If the price can recover somewhat, this is one less industry that is against the wall, which is good for global risk. Basic economic textbook theory does not quite hold at the extremes, and correlations can actually flip on their head.

Global equity markets are flat, Dow +0.2% S&P 500  +1.2%, FTSE +0.5%, DAX +0.3%, CAC 0.3%, Nikkei -1.4%, Shanghai +1.7%.

Gold prices are up at USD$1,616 an ounce. WTI Crude Oil prices have spiked up 22% to $25.3 a barrel.

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