jobless claims

The official US jobs report for February was released on Friday morning, and despite a stellar reading for job creation – 313,000 jobs added in February against prior expectations of around 200,000 – the data was mixed overall, as wage growth was weak and the unemployment rate was slightly higher than expected.

The first official US jobs data for 2018, covering January, will be reported on Friday morning by the US Department of Labor. Consensus expectations are pointing to an anticipated improvement in non-farm payrolls (NFP) over December’s disappointing outcome. Around 180,000 non-farm jobs are expected to have been added to the US economy in January following a worse-than-expected showing of 148,000 jobs added in December.

The official US jobs data for December will be reported on Friday morning by the US Department of Labor, and consensus expectations are pointing to a likely continuation of the strong job creation that prevailed through much of last year (September weather disruptions notwithstanding).

The official US jobs data for November will be reported on Friday morning by the US Department of Labor, and consensus expectations are pointing to a likely continuation of the strong job creation that has prevailed through much of the year.

Moving forward into the week ahead, US tax reform will continue to be a major market variable, especially with respect to US equities and the US dollar.

As it turns out, “only” 261,000 jobs were created in the month following September’s weather-related job disruptions, falling well below consensus estimates of around 310,000 and slightly below our target range of 270,000-300,000.

On Friday, the official US jobs data for October will be reported, and expectations for a sharp bounce-back from September’s weather-related negative reading are high.

The US dollar has clearly been heavily pressured throughout most of this year, and the pressure has shown very few signs of relenting. The sharp downward trend that has developed through the first seven months of the year has partly been driven by a cumulative realization that the Trump Administration’s pro-growth promises may not be as readily achieved as previously thought. Other related drivers of dollar weakness have been persistently weak inflation and lackluster economic data that have led to an increasingly hesitant Federal Reserve, which has recently begun to suppress expectations of many more interest rate hikes going forward.

As of Thursday morning, less than a day before Friday’s pivotal US non-farm payrolls (NFP) jobs report, futures markets (according to the CME Group’s FedWatch) are pricing-in more than a 95% likelihood of another 25-basis-point interest rate hike by the Federal Reserve during its mid-June meeting. This extremely high market-viewed probability has been further buoyed by Thursday’s ADP private employment report, which showed a stellar increase of 253,000 private-sector jobs in May against prior expectations of around 185,000. Leading the way in US private employment were services and construction, both of which saw broad increases in payrolls. Although the ADP report is not necessarily a very accurate pre-indicator of the official NFP jobs data from the US Labor Department – and sometimes even misses the mark dramatically – it does help indicate continued and increasing strength in the overall US employment picture, which bodes very well for an impending Fed rate hike.

In the May FOMC statement released on Wednesday, the Fed stated that "job gains were solid, on average, in recent months." This was a departure from the statement issued after the last FOMC meeting in March, which simply asserted that “job gains remained solid.” This subtle change in wording was a delicate nod to the highly disappointing employment numbers released in April for the month of March – 98,000 jobs added against prior consensus forecasts of around 175,000. Averaging employment gains across recent months takes focus away from March’s relatively dismal jobs data. Was March simply an anomaly in an otherwise rosy US employment picture? This Friday’s non-farm payrolls report for April will be key in answering this question.

The US jobs report for February is set to be released on Friday morning, just a few days before the Federal Open Market Committee (FOMC) meets and announces its interest rate decision next Wednesday. Unlike previous jobs reports, this Friday’s non-farm payrolls (NFP) data should serve as little more than a mere formality before the Fed very likely institutes its first rate hike of 2017 next week. That is, of course, unless the jobs data comes out to be disastrous, which is highly improbable given the positive readings from other recent employment indicators.

After the surprisingly strong UK inflation figures on Tuesday, the jobs and wages data released today confounded expectations once again, albeit to a lesser degree.