NFP Thursday

Ladies and Gentlemen,

 

The markets have been very clearly focused on Europe and specifically Greece in the last few trading sessions.

 

Tomorrow, this temporarily changes as we have the US Non-Farm Payroll number at 1.30 BST

 

The ADP employment change data today was better than expected today at 237k when 218k was consensus, this is often seen as a pre cursor for the NFPs

 

The ISM manufacturing number was also better than expected at 53.5 when 53.2 was expected, so where does this lead us.

 

The NFP consensus is 233k and last month the number was 280k but everyone knows ‘The Fed’ is data dependant and with two additional job reports before the September Fed meeting does anyone care?

 

Yes, the split seems to be how many rate hikes will there be before year end, one or two?

 

However we may need to look away from the headline figure and understand what is going on beneath the bonnet to assess how the Fed voters will interrupt the numbers

 

The labor participation rate needs to be improving, average earnings need to be ticking up the year on year, the rate is presently 2.3% and aggregate income growth needs to be positive.

 

As ever the devil is in the detail

 

Good Luck 

 

Anish Lal