US Non-Farm Payrolls (NFP) Report Preview (SEP 2024)

US Non-Farm Payrolls (NFP)

The US Non-Farm Payrolls (NFP) report showed the economy adding 142K jobs in August versus forecasts for a 160K print, while Average Hourly Earnings climbed to 3.8% from 3.6% during the same period.

US Economic Calendar – September 6, 2024

The update from theBureau of Labor Statistics (BLS) showed the Unemployment Rate narrowing to 4.2% from 4.3% in July even as the Labor Force Participation Rate held steady at 62.7%, with the report going into say that ‘job gains occurred in construction and health care.’

At the same time, the BLS revealed that ‘the change in total nonfarm payroll employment for June was revised down by 61,000, from +179,000 to +118,000, and the change for July was revised down by 25,000, from +114,000 to +89,000.’

EUR/USD Chart – 15 Minute

Chart Prepared by David Song, Strategist; EUR/USD on TradingView

EUR/USD climbed to a fresh session high (1.1156) following the lower-than-expected NFP print, but the initial reaction was short lived as the exchange rate closed the week at 1.1085. The weakness carried into the week ahead as EUR/USD slipped to a fresh monthly low (1.1002). 

Looking ahead, the US economy is anticipated to add 140K jobs in September following the 142K expansion the month prior, while the Unemployment Rate is seen holding steady at 4.2% during the same period.

At the same time, the gauge for Average Hourly Earnings is expected to increase 3.8% for the second month, and signs of a resilient labor market may encourage the Federal Reserve to further combat inflation as the central bank acknowledges that ‘if the economy remains solid and inflation persists, we can dial back policy restraint more slowly.’

With that said, a positive development may generate a bullish reaction in the US Dollar as it curbs speculation for another 50bp Fed rate cut, but a weaker-than-expected NFP report may produce headwinds for the Greenback as the Federal Open Market Committee (FOMC) starts to unwind its restrictive policy.

Additional Market Outlooks

EUR/USD Vulnerable on Close Below 50-Day SMA

USD/JPY Outlook Mired by Negative Slope in 50-Day SMA

Gold Price Weakness Pulls RSI Back from Overbought Zone

Australian Dollar Forecast: AUD/USD Rally at Threat of RSI Divergence

--- Written by David Song, Senior Strategist

Follow on Twitter at @DavidJSong