Time to see what the best and brightest see in their NFP tea leaves
Not only are Morgan Stanley the darlings of the week after their AUDJPY recco, they also sit in second spot in Bloomberg's non-farm payrolls guessing charts. Here's the top 5 and their picks for today;
- Wesbury/Stein - First Trust advisors 198k
- Ted Wiesman - Morgan Stanley 215k
- Bantleon Bank AG 190k
- Smith/Sweet - Moody's analytics 220k
- CTI Capital 230k
200k is the general number expected today
Here's how they fare vs the actual numbers
NFP performance
The recent USDJPY reactions from the data show that all the risk was to the downside with beats largely within the average parameters
USDJPY NFP reaction
The NFP is always the big data point of the month but it's been a while since the actual jobs number has meant anything significant. Good reports have been expected each month and there hasn't been any real bad news to derail the hike. The underlying details are now even more important and should be the main focus after the headline NFP for determining direction. A crappy NFP will be quickly forgotten if wages rise 1% m/m, likewise a strong number won't last if wages fall
That's the realm we're into now. The overall employment situation is solid but now the other cogs in the wheel need to start turning. Wages are expected to match the 0.2% gain seen last month but rise 2.7% higher than a year ago. They rose 2.5% y/y in Nov
It usually only gets half a glance but the average work week hours number could start to become important. It can be read in two ways. If it starts to creep up without an accompanying rise in wages that can suggest that employers are finding it tougher to fill posts, or that they are facing a shortage of skilled workers. Simply, that the labour market is tightening. If it rises alongside wages then that's more of a bullish signal as it suggests that employers are looking to further increase hiring
The Fed would love to see the jobs market tightening as that would justify their hike and hikes going forward. It should be the next natural progression and one that can accelerate if employers are confident enough, and that's when a bigger inflation risk will kick in
For today and the headline number, I'm not expecting any fireworks, unless we get a huge variation. While the market flaps about on the headline I'll be looking at the other details to gauge what it means for the wider picture and future hikes
Don't forget to enter our first NFP competition of 2016. Follow the link and put your guesses in the comments on that post only. Any guesses put in this post will not count
If you're trading over the data then best of luck to you
