Market Data 
- The US JOLTS data will be watched closely ahead of the release of the March employment report on Friday.
- Job openings are forecast to decline toward 7.63 million in February.
- The state of the labor market is a key factor for Fed officials when setting policy.
The Job Openings and Labor Turnover Survey (JOLTS) will be released on Tuesday by the United States (US) Bureau of Labor Statistics (BLS). The publication will provide data about the change in the number of job openings in February, alongside the number of layoffs and quits.
JOLTS data is scrutinized by market participants and Federal Reserve (Fed) policymakers because it can provide valuable insights into the supply-demand dynamics in the labor market, a key factor impacting salaries and inflation. Job openings have been declining steadily since coming in above 12 million in March 2022, indicating a steady cooldown in labor market conditions. In September 2024, the number of jobs declined to 7.44 million, marking the lowest reading since January 2021, before rising to 7.8 million and 8.09 million in October and November, respectively. At the end of 2024, the data came in at 7.5 million before rebounding to 7.74 million in January.
What to expect in the next JOLTS report?
Markets expect job openings to decline to 7.63 million on the last business day of February. Following the March policy meeting, the Federal Reserve (Fed) noted that the Unemployment rate has stabilized at a low level and labor market conditions remain solid. The revised Summary of Economic Projections (SEP) showed that Fed policymakers project a 4.4% unemployment rate at the end of 2025, compared to 4.3% in December’s SEP. In the post-meeting press conference, Fed Chairman Jerome Powell repeated that the labor market seemed to be broadly in balance.
It is important to note that while the JOLTS data refers to the end of February, the official Employment report, which will be released on Friday, measures data for March. Additionally, market participants could refrain from taking large positions based on this data before US President Donald Trump announces the details of the new tariff regime on Wednesday.
In February, Nonfarm Payrolls (NFP) rose by 151,000, falling short of the market expectation for an increase of 160,000. The CME FedWatch Tool currently shows that markets are pricing in a less-than-20% probability of a 25 basis points (bps) rate cut in May. Although the job openings data is unlikely to influence the Fed rate outlook, a significant negative surprise, with a reading at or below 7 million, could weigh on the US Dollar (USD) with the immediate reaction. On the other hand, the market positioning suggests that the USD doesn’t have a lot of room on the upside, even if the data comes in better than forecast.
“Hires held at 5.4 million, and total separations changed little at 5.3 million,” the BLS said in its January JOLTS report. “Within separations, quits (3.3 million) and layoffs and discharges (1.6 million) changed little.”
Economic Indicator
JOLTS Job Openings
JOLTS Job Openings is a survey done by the US Bureau of Labor Statistics to help measure job vacancies. It collects data from employers including retailers, manufacturers and different offices each month.
Read more.
When will the JOLTS report be released and how could it affect EUR/USD?
Job opening numbers will be published on Tuesday at 14:00 GMT. Eren Sengezer, European Session Lead Analyst at FXStreet, shares his technical outlook for EUR/USD:
“EUR/USD clings to a bullish stance but lacks momentum, with the Relative Strength Index (RSI) indicator on the daily chart holding slightly above 50. On the downside, the 200-day Simple Moving Average (SMA) aligns as a key support level at 1.0730 before 1.0585-1.0570 (50-day SMA, Fibonacci 38.2% retracement of the October-January downtrend).”
“Looking north, the first resistance level could be spotted at 1.0900 (static level) ahead of 1.1000 (Fibonacci 78.6% retracement) and 1.1100 (static level).”
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
