A summary of FXStreet dedicated contributors' quotes pre- and post-NFP-release.
Pre-release checklist (4th August 2017)
|Previous Non-Farm Payrolls||Positive||The establishment survey showed nonfarm payrolls expanding a consensus-beating 222K in June. Adding to the good news were upward revisions to prior months that increased payrolls by 47K.|
|Challenger Job Cuts:||Positive||A decrease in layoffs for a second consecutive month to 31,1K from 33K and and 43.3 three month ago.|
|Initial Jobless Claims and Continuing Jobless Claims||--||To be updated on the 27th July.|
|Continuing Jobless Claims||--||To be updated on the 27th July.|
|ISM Non-Manufacturing PMI||Negative||The index registered 55.8%, which reflects a decrease of 2 percentage points when compared to the May reading of 57.8%.|
|ISM Manufacturing PMI||Positive||The index registered 57.2% in June, an increase of 3.7% points when compared to the May reading of 53.5% and its highest level since March 2017.|
|University of Michigan Consumer Confidence Index||Negative||The preliminar figures show a continuing deterioration of sentiment. The index shows 93.1 vs 95.1 which was the previous release.|
|Conference Board Consumer Confidence Index||Negative||Confidence in future economic prospects continued to slide in early July, with the Expectations Index now 10.1 Index points below its January 2017 peak.|
|ADP Employment Report||--||To be updated on the 3rd August.|
Post-release checklist (4th August 2017)
Crash Course to Become an NFP Expert
Well, today is your lucky day the FXStreet team has been working on a research material to make you an expert in trading the NFP report.
Considered the backbone of the U.S. economy, the NFP has an history of rocking global markets, specially the FX market via the U.S. Dollar. Other signs of economic growth are often viewed with a little suspicion by market participants if employment figures are not at a healthy level.
Since the headline number for NFP tends to move all financial markets, as a trader it is important that you prepare for various scenarios, by developing models to predict the likely headline number.
To acomplish that, you should start with a solid understanding of employment conditions in the U.S. The more knowledge you have, the more confident you will feel trading the NFP. Making your own predictions, you don’t need to accept the market estimates as written in stone anymore. Besides, they are often well off the mark.
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NonFarm Payrolls report measures the number of jobs added or lost in the US economy over the last month. It is released usually on the first Friday of each month, at 8:30 EST. It is published by the US Department of Labor.
This report is important because the US is the largest economy in the world and its currency (US Dollar) is the global reserve currency. The many economies peg (tie) their currency's value to the reserve currency, many commodities such as gold and oil are priced in terms of the reserve currency and the local economy's debt is priced in terms of its own currency.
This report, because of its importance to the reserve currency, tends to move all markets: currencies, equities, treasuries, interest rates, and commodities. It does so immediately after the release of the economic data and sometimes dramatically.
US Departament of Labor
The department is led by the U.S. Secretary of Labor, Thomas E. Perez, the highest ranking official of the institution. On March 18, 2013, Perez was nominated by President Barack Obama and took office on July 23 2013 when he was confirmed by the Senate.
Those who advocate trading NFP releases base their advice on a previous preparation and some fundamental research. The elaboration of some macroeconomical analysis is essential for successful trading.
This research includes averages of past headline NFP numbers, Weekly Jobless Claims, ISM Industry Data reports or other employment reports as the ADP or the Challenger. Tracking these events is fundamental on the preparation of the trades to set up just after the release. You can check all this data on FXStreet Economic Calendar: ADP Report, Initial Jobless Claims, ISM Industry Data.
Not to Trade
A lot more skeptical on the benefits of trading the event, as you can read in his article “Step aside the NonFarm Payrolls release”, Adrián Aquaro, President at Trader College, says its importance has decreased a little bit lately:
“Even if the impact has diminished gradually over time, still generates huge attention on the markets and it normally drives important monthly trends. Lately another event (the Fed Monetary Policy Meetings) has been driving similar attention, thanks mainly to the Interest Rates being at 0%.”
What is NonFarm Payrolls Forecast?
NonFarm Payrolls Forecast is some sentiment based piece of content that tries to predict what the NFP numbers will be and what impact will it have on the markets. In this page, you'll find some articles and tools that will help you to understand which could be the outlook for ADP Report, Unemployment Rate, Average Hourly Earnings, Labor Force Participation Rate and some other important economic indicators.
The ADP (National Employment Report) is an estimation of nonfarm employment which is based on a survey of thousands of private sector businesses. One of the biggest differences between NFP data and ADP data is the sample and methodology of the study. ADP Jobs Report could show us an anticipation of the NFP's trends. Some outlooks are mainly based on the Jobs Report, in past data and in other related job indicators like Initial/Continuing Jobless Claims.