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Weaker jobs in the USA today will rattle the markets

What is this NFP?


Non-Farm Payroll (NFP) is a measure of employment in the United States that includes all jobs except for farm workers, private household employees, and non-profit organization employees. The NFP report is released monthly by the US Department of Labour and provides an estimate of the total number of paid workers in the country.


The NFP report is considered to be an important economic indicator because it provides information about the overall health of the US labour market. Specifically, the report can give insights into the strength of the economy, the level of consumer spending, and the likelihood of future interest rate changes.


When the NFP report shows that the number of jobs added in a given month is higher than expected, this can be interpreted as a positive sign for the economy. This is because more people are employed, which can lead to increased consumer spending and economic growth.


Conversely, when the NFP report shows that the number of jobs added in a given month is lower than expected, this can be interpreted as a negative sign for the economy. This is because fewer people are employed, which can lead to decreased consumer spending and economic contraction.


Overall, the NFP report is an important indicator of the health of the US labor market and can have a significant impact on financial markets and economic policy.


How does NFP data affect forex?


NFP releases have a general tendency to cause large movements in the forex market.

If the Fed decides to lower interest rates to combat high unemployment, it reduces demand for the dollar, causing it’s the dollar’s price to fall.


The Non-farm Payrolls report, as one of the most significant financial releases and market movers, measures the number of people employed every month in the USA, excluding farm workers, non-profit organisations and private household employees.


As a general guideline, a higher than expected figure may be considered positive for the USD, while a lower than expected figure may be considered negative.

The ADP report- Private payrolls surged by 296,000


According to payroll processing company ADP, private payrolls increased by 296,000 in the past month. This is higher than the previous month's revised number of 142,000 and significantly surpasses the estimated 133,000. In April, the industry experiencing the most significant increase in employment was leisure and hospitality, with a surge of 154,000 jobs.


Source: CNBC.com


Expectations for Today’s Release


The NFP report will be released today, Friday, May 5th, at 1:30 PM GMT.

For March, the NFP consensus was 240,000 jobs, whereas the actual number was 236,000. In addition, the forecast for April stands at 179,000, while the expected Average Hourly Earnings (MoM) is 0.3%, and the predicted Unemployment Rate is 6.7%.


Specifically, analysts expect the following figures:



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