NFP report preview

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

What is NFP report?

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

Key highlights –

• The headline number for total hires last month was 134,000. October ADP employment number has been encouraging at 226,000.

• Today payrolls are expected at 193,000.

• The second most vital component is wage growth which as of now is showing healthy growth of 2.8 percent. Today expected at 3.2 percent y/y.

• The labor force participation rate is showing no signs of rebound. Last month it was 62.7 percent.

• The unemployment rate is expected to remain the same at 3.7 percent.

• The underemployment rate is expected to improve further from current 7.5 percent.

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

Impact –

• 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 200,000) and wage growth could lead to further gains in the dollar which has been struggling since yesterday.

• 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 96.06, down 0.22 percent so far today.