Will NFP Report Once Again Indicate Strength of US Labor Market?
Investors expect the release of data on employment in the US for July. The US Bureau of Labor Statistics will be delivering the nonfarm payrolls (NFP). Analysts expect the US labor market to remain stable, despite trade barriers and the escalation of the trade dispute with China. On Wednesday, the ADP nonfarm payroll figure jumped to 219.000 beating the forecast of 186.000.
According to the forecast of economists, the US economy created 190.000 new jobs in July. The unemployment rate is forecast falling one-tenth of a percentage point to 3.9% in July. Average hourly earnings are projected to increase by 0.3% in July after rising 0.2% in June.
Job gains in July were likely across all sectors. Manufacturing payrolls are forecast rising by 22.000 jobs after increasing by 36.000 in June. Construction companies likely added to the 13.000 jobs created in June. Government employment is forecast increasing by 1.000 jobs in July.
Strong US employment data will allow the Federal Reserve to raise interest rates again in September. This week, the US Federal Reserve left interest rates unchanged, while painting an upbeat portrait of both the labor market and economy. The US central bank also said "the labor market has continued to strengthen and economic activity has been rising at a strong rate." The Fed increased borrowing costs in June for the second time this year.