NFP growth set to recover in November following October disruption from hurricanes, strikes
- US Nonfarm Payrolls are set to jump by 200K in November after rising by just 12K in October.
- The United States Bureau of Labor Statistics will publish the labor data on Friday at 13:30 GMT.
- US jobs data is critical to gauging future Fed rate cuts and the US Dollar price direction.
The United States (US) Bureau of Labor Statistics (BLS) will release the high-impact Nonfarm Payrolls (NFP) data for November on Friday at 13:30 GMT. The Federal Reserve’s (Fed) future interest-rate cuts and the next direction in the US Dollar (USD) depend highly on the November jobs report.
What to expect in the next Nonfarm Payrolls report?
Economists expect the Employment Report to show that the US economy created 200,000 jobs in November, following a meagre gain of 12K in October due to distortions caused by two hurricanes and the strike at Boeing.
The Unemployment Rate (UE) is likely to edge higher to 4.2% in the same period, compared to the 4.1% reported in October.
Meanwhile, Average Hourly Earnings (AHE), a closely-watched measure of wage inflation, are seen rising by 3.9% in the year through November after a 4.0% growth in October.
The November jobs report is critical to gauging the state of the US labor market and the Fed’s easing trajectory in the coming months, especially after Fed Chairman Jerome Powell’s recent cautious stance on rate cuts.
Last month at an event in Dallas, Powell said there was no need to rush rate cuts with the economy still growing, the job market solid and inflation still above the 2% target. Meanwhile, the Fed Chief sounded optimistic about the state of the US economy at the New York Times’ DealBook Summit on Wednesday.
Previewing the November employment situation report, TD Securities analysts said: “We now look for mean reversion in Nov with ~75k jobs added back to the series as the twin impacts from hurricanes/strike fade away.”
“We also expect the UE rate to rise by a tenth to 4.2%, while wage growth likely cooled to 0.2% m/m following October’s outsized 0.4% increase.,” they added.
