Morning Update – 06/01/2017 – by Arjun Lakhanpal

Morning all..Wall St dipped in front of the Non-farm payroll data from the US due today and just below unchanged after a rather weak session and late rally. Nikkei closed lower on the back of a weaker USDJPY; finally ending the day down 0.34% but again a quiet session in front of the NFP’s. A lot of attention on CNH (China currency) and there was some relief from the steep rise seen recently. PBOC fixed yuan 0.9% strong at 6.8668 per USD vs 6.9307 prev; biggest increase since 2005 when the yuan was revalued and taken off the dollar peg (in a sign Chinese authorities are fighting to control yuan’s descent). Markets expected to be quiet until the NFP data later today. Bloomberg: Snow in Washington area may affect jobs report release; possible delayed opening of Govt agencies could lead to release of data via internet.. Japan Nov Inflation-Adj Real Wages: -0.2% y/y vs 0.0% in Oct; real wages fall for first time since Dec 2015; partly due to fall in bonus payments in Nov and this is a blow for PM Abe as he knows that wages must rise to really get away from deflation. Oil was quiet and close to unchanged from NY close and US 10yr yield sits at 2.37% which is helping the dollar to rise marginally this morning and takes USDJPY back above 116.20. This morning we get UK labour costs and confidence data and retail sales for the Euro zone. The main event though is Non-farm payrolls from the US at 13:30 GMT.. Good luck.