NFP report preview

Today June NFP report is to be published at 12:30 GMT from the United States.

What is the NFP report?

• NFP or non-farm payroll report is the monthly statistics on labor condition in the US released by the US Department of Labor Statistics. The report comprises goods, construction, and manufacturing sector companies.
• This report influences the financial markets deeply across asset class.

Key highlights –

• The headline number for total hires last month was 201,000. June ADP employment number has been encouraging at 177,000.

• Today payrolls are expected at 195,000.

• The second most vital component is wage growth which as of now is showing a healthy growth of 2.7 percent. Today expected at 2.8 percent y/y.

• The labor force participation rate is showing no signs of rebound.

• The unemployment rate is expected to remain the same at 3.8 percent.

• The underemployment rate is expected to improve further from current 7.6 percent.

• Average weekly hours were previous 34.5; no changes expected today.

Impact –

• The immediate impact is usually very volatile and likely to affect the majority of the asset classes.

• A better than expected report especially the headline number (above 215,000) and wage growth could lead to further gains in the dollar which has been showing some weakness lately.

• The dollar could suffer setback along with U.S. equities on a materially weak report of headline below 150,000. The dollar index is currently trading at 94.33, down 0.07 percent so far today.