April 2017 in Review

April began with the highly-anticipated U.S. Employment situation report on Friday, April 7th. The all important Non-Farm Payroll headline came in far below expectations at 98,000 vs. 175,000. Winter storm Stella, a category 3 storm that affected the Northeastern United States during the survey weeks was squarely blamed for this disappointment. On the bright side, the unemployment rate figures fell a pronounced 2 tenths of a percent to 4.5%, printing the lowest unemployment level in almost a decade.

Looking at currency moves over the month, the Canadian dollar was negatively affected by the Trump Administration’s initiation of government level trade cases on exports such as dairy, lumber, and aluminum. With accusations of unfair counter export subsidies across its northern border, talk of tariffs combined with falling crude oil prices sent the Loonie down 3% from the time of the first headline on the 18th.

Falling gasoline prices dragged benchmark crude oil futures lower amid strong refinery activity and soft fuel demand. Specifically, U.S. production, which has risen to August 2015 highs, has continued to undermine efforts by the Organization of Petroleum Exporting Countries and its allies to reduce global output. With U.S. crude production on the rise for 9 weeks straight, a number of crude-producing countries, spearheaded by Saudi Arabia, reached a draft agreement to extend output cuts in order to keep prices from falling further.

In Europe, independent candidate, Emmanuel Macron won the primary election round on Sunday the 23rd in the highly divisive French Election with a 23.7% share of the vote. He and runner-up candidate Marine Le Pen will face off in the final round of voting on Sunday May 7th. In a country where terrorism and an ongoing migrant crisis are among the key election issues, political correctness may very well motivate voters to lie to pollsters en masse. While Le Pen currently has a lower probability of being elected, her success has the potential to cause severe consequences for the future of the Eurozone and cannot yet be ruled out.

Looking ahead to the month of May, we start our calendars with a meeting of the Governors of the U.S. Federal Reserve on May 3rd, after which the U.S. employment situation report comes out on Friday May 5th. Sunday May 7th has Marine Le Pen facing Emmanuel Macron in the final round of the polemic French election. New Zealand and Australian Central banks hold policy meetings on the 10th and 15th respectively while we see a rate announcement from the Bank of Canada on the 24th .

Download the PDF article here.

April in Review

The information contained in this article is for information purposes only, and represent the views of the author. It is not intended as specific investment or financial advice, or a recommendation or solicitation to buy or sell any security. Any investments or strategies listed in this article may not be suitable for all investors. Past performance is not indicative of future performance, and as with any investment, prices may fluctuate. It is recommended that advice is sought from a qualified investment professional prior to implementing any financial plan. LOM has made every effort to ensure that the contents herein have been compiled from sources believed reliable, however LOM does not warrant the accuracy, adequacy, timeliness, or completeness of this information expressly disclaims liability for errors or omissions in this information.