Ladies
and Gentlemen
Today
at 13.30 BST we get the latest employment report from the United States, it
will assist government policy makers in their quest to decide on the timing of
the first rate rise since 2006.
The
change in Non-Farm payrolls is expected to be 217k according to the Bloomberg
Survey, the report is seen as the deciding factor for the September FOMC.
Commentators believe the chances of ‘lift off’ have diminished in the light of
the financial turmoil, however the employment survey was concluded before this
period.
The
August number is heavily influenced by seasonal factors and difficult to
predict. Over the last 10 years the difference between the consensus and the
actually number has been biggest in both March and August, there was a 119k
miss in March of this year let’s hope we are closer for August.
It is
important to remember the dual mandate of the Fed, meaning that both employment
and inflation will have to be at levels where tightening monetary policy is
appropriate.
The
unemployment rate which has already reached the top end of the Fed’s year end
projection 5.2%, is a 7 year low. However, a falling oil price means away from
the workforce there is a disinflationary environment and may enable the key
decision to be delayed.
At
Atom8 we are cognisant that this is an important number and that it is
worthwhile looking at all the data that is released at 13.30 including the July
revisions.
Good
Luck
Anish S. Lal @anish8fx
FX & Precious Metals, Atom8
Financial Services LLP
2nd Floor, Centenary House, Palliser
Road, London W14 9EQ, UK
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