This time the range of predictions is relatively narrow: between 110K and 200K jobs added. Alexandra Estiot who sees the US labor market growing by 180-200K in February justifies her optimistic forecast by saying that "in late 2012, some signs of strengthening were already obvious, with non-farm private payrolls growing by more than 200k a month" and that "leading indicators are pointing to a strengthening of that trend, with employment components of ISM surveys at historical highs." She nevertheless warns about the effects of the automatic budget cuts which after being implemented might harm the labor market.
Other analysts, who expect more modest jobs gains in the range of 130K-170K, are also worried about the impact of the sequester and some suspect that the steady growth trend might be coming to an end. Steve Ruffley points to a similar situation in the corresponding period of last year: "We have seen a steady decrease in 2013 from the NFP highs of 247K to last month’s figure of 157K; this mirrors the start of 2012 where the NFP went from 259K to 154K."
Should the reading prove better than expected "it could cause short-term positive reaction in the stocks market," as Talal Abdullah suggests and adds that "the uptick in NFP should increase the appeal for the U.S. dollar, as it raises the outlook for growth."
US NFP numbers for February will be released on March 8 at 13:30 GMT.
|171-190K||Alexandra Estiot, Valeria Bednarik, Brian Kahn|
|151-170K||Adam Narczewski, Gus Farrow|
|131-150K||David Pegler, Joseph Trevisani, Talal Abdullah, Steve Ruffley|
|110-130K||Mark De La Paz, Dale J Pinkert, Alberto Muñoz|
Below you will find the complete commentaries of some of the contributing experts.
Alexandra Estiot - Senior Economist at BNP Paribas:"If the US economy was only about the private sector, I would be highly confident that 2013 will see a marked acceleration in GDP growth and thus job creations. Most of the headwinds that prevented a sharp rebound following the 2008-09 recession have abated. In late 2012, some signs of strengthening were already obvious, with non-farm private payrolls growing by more than 200k a month. Leading indicators are pointing to a strengthening of that trend, with employment components of ISM surveys at historical highs. But forecasting the US economy is also about the effect of fiscal policy, which is all about uncertainty. Right now, it looks like the sequester will be implemented. The direct impact is not to be felt by the labour market report before April, and it is likely to be smoothed. As for indirect effects, they could be lasting and painful if not easy to estimate. Disruptions that will come from the furlough of civil servants will damage the good functioning of the overall economy, which is likely to translate into lower production and demand. As for February data, I do expect a rebound in non-farm payrolls monthly increase in the vicinity of 180k-200k. But spring will be about uncertainty. Once more…"
Steve Ruffley - Consultant Trading Educator at InterTrader.com:"I am still surprised by the strength of the S&P and that the markets in general are happy to remain buying dips. One thing we know about the markets however is that what goes up must come down. If we go back basics and look at trends in the actual NFP data then it looks like the ‘up’ trend is at an end. We have seen a steady decrease in 2013 from the NFP highs of 247K to last month’s figure of 157K; this mirrors the start of 2012 where the NFP went from 259K to 154K. If you look at the data technically then we are at a good level of support and we are trending just below a 200 day MA. Fundamentally we have seen both good news and bad news in the global economy and personally I don’t see any bias, so I can only take a view technically and I predict the NFP to be 130K with a range of 110K on the low to 165K on the high."
Talal Abdullah - Financial Analyst at ICN.com:"Focus remains on the U.S. economy as Obama's administration is about to face another 'Automatic Spending Cuts' again.
U.S. Non-Farm Payrolls are expected to show the economy managed to add 130 - 160,000 jobs during February. It could cause short-term positive reaction in the stocks market if it is better than expected. The uptick in NFP should increase the appeal for the U.S. dollar, as it raises the outlook for growth. Nonetheless, unemployment is expected to stay unchanged at 7.9% as discouraged workers return to the labor force.
Unemployment stays elevated, negative jobs figures shall feed hopes that the Federal Reserve will keep monetary easing to help the economy; easing early exit woes."