US NFP preview - Nomura
|Another round of the US Non-Farm Payrolls drops this Friday at 12:30 GMT and broader markets are expected an uptick over the previous month, and Nomura analysts are calling for a better-than-expected reading as they expect the strong reporting trend to continue into August.
"Consensus expectations:
- Headline change expected +198K, prior +157K
- Unemployment rate expected 3.8%, prior 3.9%
- Average hourly earnings expected +0.2% m/m, prior +0.3%
- Average hourly earnings expected +2.7% y/y, prior +2.7%
After a 157k gain in nonfarm payroll employment in July, a somewhat stronger report than the headline reading suggests, we expect a solid 215k increase in NFP employment in August. Part of the below-forecast reading for July was attributable to unusual declines in certain industries that could revert in August.
A 220k NFP gain in August would be consistent with economic growth of roughly 3%. However, despite forecasting a solid 20k gain in manufacturer employment in August, we see some downside risk to the near- to medium-term employment growth outlook if manufacturing growth slows materially due to trade concerns. With a modestly negative bias due to calendar effects, we expect average hourly earnings (AHE) to increase by 0.18% m-o-m in August, corresponding to 2.69% y-o-y. Consistent with strong employment growth, we expect the unemployment rate to fall 0.1pp to 3.8% in August and see room for a possibly larger decline in light of a possible drop in LFPR."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.