Ilian Yotov, who reminds that US employment data in September was more positive than expected, believes that "we could see another month of decent job creation" in October. Even though it seems that the pace of hiring has been improving recently, it is still "is too early to talk about a US 'steady path to recovery,'" as Valeria Bednarik suggests, adding that the country is only rather "moving away from recession."
As far as the unemployment rate is concerned, which saw a considerable drop in September to 7.8% from 8.1%, market experts agree that it will most probably remain at 7.8% or increase to 7.9%, "as discouraged workers return to the labor force and that will have a deeper negative impact," in the words of Talal Abdullah.
The release of the October NFP report will be closely followed as it comes just four days before the US presidential elections and, as Yohay Elam projects "a better than expected figure will help Obama, and could therefore trigger a 'risk off" reaction - a stronger dollar," while "a weaker result will help Romney, and therefore make markets more cheerful ('risk on'), with the dollar falling."
The US Department of Labor will publish the October NFP numbers on November 2, at 12:30 GMT. Below you will find the complete predictions of the contributing economists.
Yohay Elam - Analyst at Forex Crunch:"Non-Farm Payrolls will probably show another gain of around 100K to 140K. Basically, the economic signs paint the same picture: slow growth, with stronger housing and weaker manufacturing. This hasn't changed. However, the initial report could be surprising, and can be revised later. Last month we've witnessed a gain of an additional 86K jobs in August and July through revisions. Despite the volatility, the headline figure will have a strong impact, especially as it comes 4 days before the elections, which seem too close to call at this moment. A better than expected figure will help Obama, and could therefore trigger a 'risk off' reaction - a stronger dollar. A weaker result will help Romney, and therefore make markets more cheerful ('risk on'), with the dollar falling."
Talal Abdullah - Financial Analyst at ICN.com:"U.S. Non-Farm Payrolls are expected to show that the U.S. economy managed to add 100,000 - 130,000 jobs during October. Good jobs will likely cause a short term positive reaction in the stocks market if it is better than expected.
The uptick in the NFP should increase the appeal for the U.S. dollar, as it raises the outlook for growth, but a positive sentiment reaction might support higher yielders indeed. Nonetheless, the unemployment rate is expected to rise to 7.9% from 7.8% as discouraged workers return to the labor force and that will have a deeper negative impact and unwinding of the short positive spike for markets after last month and that will be more evident of risk aversion than anything else.
There is no doubt that the QE3 will create more jobs and boost gross domestic product, as the QE2 had created more than two million jobs and boosted gross domestic product by three percent. Yet, we can't say the U.S. economy is now on a steady path to recovery, as the labor market is still 'far from normal,' where conditions in the labor market are still challenging, although I do believe that the labor market will continue it's positive trend after the FOMC decided to indulge in quantitative easing."
Ilian Yotov - FX Strategist and Founder at AllThingsForex:"After the surprisingly positive September NFP data, we could see another month of decent job creation with the U.S. economy expected to add up to 120K jobs in October, compared with 114K in September, while the unemployment rate remains at 7.8%. The greenback could continue to benefit if the U.S. economy demonstrates resilience in the face of a global slowdown.
Alexandra Estiot - Senior Economist at BNP Paribas:"Latest data indicate that the US economy is slowly emerging from a soft patch. However, since it rebounded from the great contraction of 2008-09, these episodes have been numerous, and none of them proved long-lasting. Several risks are no more weighing on prospects, but the one remaining is definitely strong. The so-called fiscal cliff makes it impossible for the business sector to be sure neither about prospects for domestic demand nor about the profitability of an expansion in capacities since the fiscal part of the equation is unknown. This will make the wait-and-see attitude to stay in place. If the results of the general elections are clear enough to remove that uncertainty, a stronger rebound could start building in late-2012. A clever resolution of the fiscal cliff could definitely open the way to a strong rebound as the sky is clearer when it comes to the eurozone debt crisis and the US housing market. Until resolution is known, we however do not expect non-farm payrolls to expand faster than 120-140k per month."
Steve Ruffley – Owner of Tradermaker.com:"After the good news of last month’s unemployment rate and jobs growth we are looking for this to continue this month with the figure for October scheduled out the start of November.
However last month’s NFP was overshadowed by the drop in the Unemployment Rate to 7.8%. This was largely affected by the change in the Household Survey which added 873,000 jobs to the unemployment calculations. The work week increased 0.1 and recent Consumer Sentiment indices are holding firm.
Although the figure last month was good it is worth remembering that over the course of the year the headline data has in fact been on rather a bumpy road. We have seen the ups of last month and the downs of the second quarter where employment levels led the fed to discuss offering yet further measures to ease the ailing U.S. economy.
The roller coaster is far from over and it is too early to say the road to recovery is lined with gold. The fall in unemployment although good is second fiddle to the fact that we still need headline jobs growth and private payrolls to give us a few good months to indicate recovery is catching momentum.
This month we expect a figure similar to last month of around 110-140K the Unemployment Rate holding steady at 7.8-7.9%. Anything above and we can seriously look to next year as a period of sustained growth and employment. If it falters it could be back to the drawing board for Mr Bernanke and his minions."