Analysts at Nomura offered a preview for this week's key US nonfarm payrolls data.
"We expect a 175k gain in nonfarm payroll employment in October as modest positive payback from Hurricane Florence is offset by weakness due to Hurricane Michael."
"While incoming employment data has remained strong, the timing of Hurricane Michael’s landfall, albeit in a less-populated region relative to Hurricane Irma in 2017, suggests that business disruptions and civilian evacuations may have depressed payroll numbers during the month. We expect a modest 0.17% m-o-m increase in average hourly earnings (AHE)."
"Unusually large increases in AHE in the Carolinas during September, likely weather related, may revert in October, offsetting any weather effect from Hurricane Michael."
"However, the position of the BLS survey week relative to the first of the month suggests a modest downward bias on monthly AHE growth. Despite this downward bias, base effects are likely to push up AHE growth on a 12-month basis to 3.08%, its highest level since April 2009."
"We expect the unemployment rate to remain at a low-3.7% after a sharp decline in September."
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