Macro outlook for next week: The Fed is expected to be more cautious, and non-agricultural data may add fuel to the dollar

According to Mars Finance news, the largest ETF tracking Bitcoin, the darling of global speculators this week, has experienced the most severe capital outflow in history, the volatility index of US Treasuries has quietly risen, and the US stock market has seen the worst year-end decline on record. There are no signs of panic in the market, but the market trend does indicate a sense of caution that has been largely absent over the past 12 months, at least in the risk asset space. Concerns about Trump's policies and their impact on inflation have awakened the hedge market. The non-farm payroll report next week will play a core role in influencing market sentiment, and the key points that the market will focus on in the new week are as follows:

·Monday 22:30, speech by Federal Reserve Governor Lisa Cook;

·Tuesday 18:00, Eurozone December CPI YoY/MoM preliminary, Eurozone November unemployment rate;

·Tuesday 23:00, US December ISM non-manufacturing PMI, US November JOLTS job openings;

·Wednesday 21:15, US December ADP employment;

·Thursday 03:00, Federal Reserve releases minutes of December monetary policy meeting;

·Thursday 09:30, China December CPI YoY;

·Thursday 20:30, US December Challenger job cuts;

·Thursday 22:00, speech by 2026 FOMC voter, Philadelphia Fed President Harker;

·Friday 01:40, speech by 2027 FOMC voter, Richmond Fed President Barkin;

·Friday 02:30, speech by 2025 FOMC voter, Kansas City Fed President George on the economic and monetary policy outlook;

·Friday 21:30, US December unemployment rate, US December seasonally adjusted non-farm payrolls, US December average hourly earnings YoY/MoM;

·Friday 23:00, US January 1-year inflation rate expectations preliminary, US January Michigan consumer sentiment index preliminary.

Next week, the US will release several labor market data, starting with the Tuesday JOLTS job openings data, followed by the Wednesday ADP employment data, and finally the Friday non-farm data. It is worth noting that the December non-farm data is the first report in several months that is not affected by one-time factors. UBS expects the US to add close to the recent average number of jobs in December, continuing to show a gradual cooling of the labor market, providing room for the Federal Reserve to cut rates further. Given the current market pricing, strong labor data is unlikely to lead to further rate cuts by the Federal Reserve, while weak data may lead the market to consider further rate cuts. However, US data is unlikely to weaken the US dollar index at this stage.