After 3 consecutive months of disappointing data, the market is eager to see a rebound in Nonfarm Payrolls figures for July. The general consensus is 80K but the most part of the analysts polled for this edition of the NFP forecast report is a bit more optimistic and believes the labour market in the United States has straightened since our average NFP numbers preview is around 110 - 130K.
Bill Hubard, Chief Economist at Markets.com, forecasts a ‘muted’ 110,000 gain in July Nonfarm Payrolls after the depressed run averaging only 75,000 in the prior 3 months. Adam Narczewski, Financial Analyst at X-Trade Brokers, XTB, also expects a rebound (compared to the last couple of months) on the labor market with a 100 – 130K increase.
However, the two analysts who show an absolute bearishness in their forecasts, Alberto Muñoz, Forex Analyst at FXstreet.com and Yohay Elam, Analyst at Forex Crunch, think the jobs creation in the United States will be around 50K. "The US will probably see another small gain in jobs, after the recent mediocre reports. The economy continues to grow very slowly, and this will probably be reflected in a gain of around 50K jobs. This is a favorable situation for the US dollar: the US economy is not strong enough to lift the world from its misery, but not bad enough for outright QE3. The unemployment rate might tick up to 8.3% or remain unchanged," said Elam.
The US Department of Labor will release the Nonfarm Payrolls data for June on August 3 at 12:30 GMT. Below you will find full commentaries of the contributing analysts.
We are expecting that U.S. to add 70,000 – 100,000 jobs during July, compared to the mediocre 80,000 jobs added, while it’s likely that the unemployment would hold steady at 8.2% after rising in May from 8.1%.
Still, markets are worried about the jobs outlook after Federal Reserve Chairman Ben Bernanke said the labor market is still "far from normal" as well he claimed the recent plunge in jobless rate underestimates the labor market weakness.
In fact, hopes are 'Moderate' ahead of the jobs report. Now, everyone expects 'Moderate' jobs growth in July, accordingly, I strongly advice traders to act carefully ahead of the report, as the U.S. dollar will be standing at a crossroads."
The quick claims reversal points to a smaller impact, however. We forecast a 110,000 gain in July non-farm payrolls, including a ‘temporary’ 10,000 boost to manufacturing from seasonal adjustment issues in the auto sector, and a steady 8.2% unemployment rate. Improvement in the ISM also at this point looks likely to be muted. The Empire State and Philly Fed manufacturing surveys showed only slight improvement in July after sharp slowdowns in June, with the average of the two on an ISM-comparable basis rising to 48.9 from 47.7."
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Bill Hubard, Chief Economist at Markets.com, forecasts a ‘muted’ 110,000 gain in July Nonfarm Payrolls after the depressed run averaging only 75,000 in the prior 3 months. Adam Narczewski, Financial Analyst at X-Trade Brokers, XTB, also expects a rebound (compared to the last couple of months) on the labor market with a 100 – 130K increase.
However, the two analysts who show an absolute bearishness in their forecasts, Alberto Muñoz, Forex Analyst at FXstreet.com and Yohay Elam, Analyst at Forex Crunch, think the jobs creation in the United States will be around 50K. "The US will probably see another small gain in jobs, after the recent mediocre reports. The economy continues to grow very slowly, and this will probably be reflected in a gain of around 50K jobs. This is a favorable situation for the US dollar: the US economy is not strong enough to lift the world from its misery, but not bad enough for outright QE3. The unemployment rate might tick up to 8.3% or remain unchanged," said Elam.
The US Department of Labor will release the Nonfarm Payrolls data for June on August 3 at 12:30 GMT. Below you will find full commentaries of the contributing analysts.
Alexandra Estiot - Senior Economist at BNP Paribas:
"July is set to mark the fourth straight month of job creations below the 100k threshold, even if we do expect a slight rebound to 95k, from 80k in June and an average of 75k per month since April. Regional manufacturing surveys as well as initial claims data failed to rebound markedly in July, but they stopped deteriorating at least. However, it is rather difficult to be upbeat about the US labour market. Even if the US economy was hit later by the global manufacturing slowdown, it is finally hit. The great improvement of the US competitiveness over the last few years will help cushion the slowdown, though. An additional reason not to be too pessimistic is the tentative signs that the Chinese economy may be responding positively to the eased policy mix. Added to the very limited pressures on prices, these are reasons to expect that the US business sector will be able to safeguard its profitability. This is definitely not enough to guarantee a rebound in job creations, but should allow payrolls not to shrink. The pace of increase in non-farm payrolls will, however, remain too limited to avoid an increase in the unemployment rate, which we do expect at 8.3% in July."Steve Ruffley - Analyst at Tradermaker.com:
"This month’s Non Farm Payrolls figure will be closely watched by the markets after the rather horrendous figures of late. The 80K seen in July wasn’t rally the earth shattering figure some were predicting and it is also worth remembering that during any recovery employment is always the lagging indicator. With very little changing since last month we envisage that a number around 110K would be seen as positive. The unemployment rate at 8.2% still needs to drop off in order to convince many that jobs are being created but with the hangover from seasonal adjustments still in play, the lackluster private and public sector employment outlook and the continuing uncertainty from Europe and even Asia, don’t expect anything out of this world."Talal Abdullah - Analyst at ICN.com:
"Focus remains on the world`s largest economy and its ailing labor market as long as unemployment stays elevated and confidence recedes considerably, but negative jobs figures and mounting troubles in Europe and elsewhere shall boost disappoint and add to markets losses.We are expecting that U.S. to add 70,000 – 100,000 jobs during July, compared to the mediocre 80,000 jobs added, while it’s likely that the unemployment would hold steady at 8.2% after rising in May from 8.1%.
Still, markets are worried about the jobs outlook after Federal Reserve Chairman Ben Bernanke said the labor market is still "far from normal" as well he claimed the recent plunge in jobless rate underestimates the labor market weakness.
In fact, hopes are 'Moderate' ahead of the jobs report. Now, everyone expects 'Moderate' jobs growth in July, accordingly, I strongly advice traders to act carefully ahead of the report, as the U.S. dollar will be standing at a crossroads."
Adam Narczewski - Financial Analyst at X-Trade Brokers, XTB:
"The economic situation this year resembles what happened last year. After a good first half of the year, a deepening debt crisis along with increasing oil prices caused a deterioration of the U.S labor market. We have observed the same factors this year, but in 2011, the increase in unemployment started one month before after recovery started. Taking this into account, after three straight months of disappointing figures, I expect a rebound (compared to the last couple of months) on the labor market with a 100 – 130K increase in nonfarm payrolls in July."Yohay Elam - Analyst at Forex Crunch:
"The US will probably see another small gain in jobs, after the recent mediocre reports. The economy continues to grow very slowly, and this will probably be reflected in a gain of around 50K jobs. This is a favorable situation for the US dollar: the US economy is not strong enough to lift the world from its misery, but not bad enough for outright QE3. The unemployment rate might tick up to 8.3% or remain unchanged."Bill Hubard - Chief Economist at Markets.com:
"A much quicker and sharper negative reversal in jobless claims in the survey week for the employment report pointed to less of a temporary boost to manufacturing payrolls from auto sector seasonal adjustment issues. We forecast a ‘muted’ 110,000 gain in July nonfarm payrolls after the depressed run averaging only 75,000 in the prior 3 months. The initial round of regional manufacturing surveys also pointed to only small improvement in the ISM. We look for a rise to 50.5 in July after the 3.8-point plunge to a contractionary 49.7 in June. And early industry and analyst indications for July retail and auto sales didn’t point to much improvement from the weak recent run for consumer spending.The quick claims reversal points to a smaller impact, however. We forecast a 110,000 gain in July non-farm payrolls, including a ‘temporary’ 10,000 boost to manufacturing from seasonal adjustment issues in the auto sector, and a steady 8.2% unemployment rate. Improvement in the ISM also at this point looks likely to be muted. The Empire State and Philly Fed manufacturing surveys showed only slight improvement in July after sharp slowdowns in June, with the average of the two on an ISM-comparable basis rising to 48.9 from 47.7."
