U.S Non Farm Payrolls

The U.S Non Farm Payrolls will be released Friday, 5th of October 2018 12:30 GMT and is a key economic indicator that can cause volatility in the markets.

What to Expect this Month: There is an expectation that the Nonfarm Payrolls report will show an employment increase by 180k in September. If the expectations are accurate it means a slight deceleration from the 201k in August and just below the six-month average of 192k.

The forecast is in-line with the economy growth, around 3% and above the pace of employment growth required to adsorb new labor market entrants. The readings throughout the month have displayed healthy statistics with low initial jobless claims and high regional business surveys.

The Nonfarm Payrolls report is expected to show that the US economy added 191,000 new jobs in August. The unemployment rate is expected to fall to 3.8% from the previous 3.95%, and wages growth is seen rising 0.2% Month-on-Month and 2.7% Year-on-Year.

Weekly unemployment claims reduced in the last week of the August, falling to 203K, the lowest level since early December 1969, however the ADP survey showed that the private sector added only 163,000 jobs in August, well below the previous months figure at 217K and the expected 190K, which is the lowest level since October last year.

The markets are now focusing on when US rates will reach a normal level, and subsequently, when the Fed will pause its tightening cycle. Investors will not be too concerned over fewer new jobs, as long as wages don't reach a slower pace. The Fed is determinate to keep any rate hikes gradual as growth in jobs is strong and inflation is under control. Further increases in interest rates can be expected if the growth continues and there are no surprises in the US economy.

Opportunities around the NFP Reports: Regardless of the results of the Non Farm Payrolls, the markets always experience moves immediately after the release which offer traders excellent short-term trading opportunities. Positive or negative reports will affect market sentiment which can create new trends and trading opportunities.

Monitor the markets for better trading advantages: https://www.yadix.com/forex-trading-community/economic-calendar/