Markets Focused on US NFP Report
The focus of market participants are data on the US labor market, which will be released today. Nonfarm payrolls (NFP) probably rose by 191.000 jobs last month after gaining 157.000 in July. The unemployment rate expected to have fallen back to an 18-year low of 3.8%. Average hourly earnings are forecast increasing 0.2% in August after rising 0.3% in July. That would keep the annual increase in wages at 2.7% in August.
Job gains in August were likely across all sectors. Manufacturing payrolls are forecast rising by 24.000 jobs after increasing by 37.000 jobs in July. Construction companies probably added to the 19.000 workers hired in July.
Another encouraging labor market data should instill greater confidence that gradual interest rate increases are still the most appropriate course of policy action for the foreseeable future. The expected one-tenth of a percentage point drop in the unemployment rate from 3.9% in July should underscore tightening labor market conditions and cement expectations for a third interest rate increase from the Federal Reserve this year when policymakers meet on September 25-26.