Hear ye, hear ye! I have me a preview of the NFP, won’t you click and see?
How do you like my dope rhyming skills yo? Ha! It seems like most market participants don’t see themselves giving September’s Non-Farm Payrolls (NFP) report as much thumbs ups as you would give my awesome rhyme.
Analysts are anticipating employment to have been flat during month after the pleasant surprise that the NFP report for August posted. It showed that only 54,000 jobs were lost, almost half the forecasted 104,000 decline. Adding to the gloominess is the unemployment rate which is projected to have increased to 9.7% in September following its 9.6% reading in August.
Other reports related to the U.S. job market say the same thing.
Yesterday, the ADP‘s version of the non-farm employment reported its first negative number in seven months. It showed that 39,000 net jobs were lost in September, hinting that Friday’s jobs report could follow suit.
While the rise seems to have stopped, initial jobless claims still refuse to go below 450,000 handle, indicating that companies still aren’t comfortable enough to start hiring again.
And here’s a little known fact: application for food stamps, also known as Supplemental Nutrition Assistance Program (SNAP) has hit an all-time high of 41,836,330, which has cost around 5.6 billion dollars.
If you’re wondering what makes the upcoming NFP special, well, it could have a make-or-break effect on the US dollar. As we all know, the Greenback has been selling off like Edward Cullen posters during a Twilight premier ever since the Fed started expressing its intention to implement further QE. Worse-than-expected NFP results would confirm that the US economy is still struggling and needs more stimulus, possibly prompting the Fed to walk the talk.
While the FOMC statement isn’t due until next month, increased speculations that the Fed would conduct another round of QE are enough to push the dollar even lower. EUR/USD back at 1.5000, anyone?
Then again, if the employment report shows an upside surprise, I guess the US dollar could breathe a sigh of relief. But, who knows, an exceptionally strong NFP reading might just bring good ole risk appetite back in the markets and push the safe-haven dollar down. Yipes! It’s really tough to tell how traders would react to the NFP so y’all better stay on your toes!