It’s a new month which means the latest Non-Farm Payroll figures will be released this Friday by the Bureau of Labor Statistics. The data is due to be released at 13:30 PM London time.
Why is the announcement important?
Non-farm payroll is one of the most closely watched indicators and is considered the most wide-ranging measure of job creation in the United States. An increase in the non-farm payrolls would suggest rising employment and potential inflation pressure which would mean a potential rate increase by the Federal Reserve. A decline would suggest a slowing economy which would mean a decline in the interest rates more likely. The measure accounts for around 80% of the workers who contribute to the Gross Domestic Product.
In December, the total non-farm payroll employment increased by 312,000 beating the economist’s forecast of 173,000. Most significant job gains were in health care, food services and drinking places, construction, manufacturing, and retail trade.
Economists are expecting an increase by 165,000 in the month of January and it will be interesting how the data will be impacted by the four-week partial government shutdown. The unemployment rate is expected to remain unchanged at 3.9%. Average hourly earnings are also expected to remain the same as previous at 3.2%.
All eyes on the announcement later.
By Klāvs Valters
This article is written by a GO Markets Analyst and is based on their independent analysis. They remain fully responsible for the views expressed as well as any remaining error or omissions. Trading Forex and Derivatives carries a high level of risk.
Sources: Google, Datawrapper