The United States non Farm Payroll (NFP) data was lower than expected. The America's Labor Department on Friday reported that NFP growth in September was just 194,000.
That number is below the expectations of 366,000. The report was also down from 490,000 in August. Meanwhile, the unemployment rate in that country also fell from 5.2% to 4.8% in September.
However, that achievement was still better than the expectations of 5.1%. The Average hourly earnings rose from 0.4% to 0.6% which is better than the stagnant expectations.
Responding to the report, Brad McMillan, an analyst with commonwealth financial network, suspected a lack of labor supply was to blame for last month's low U.S. NFP figures.
The Market’s Concern is Raising again
The biggest problem is not because the growth is slowing. However, that is more because people are still afraid to go back to work. This statement was shared by McMillan lately.
The United States Employment report is the last important employment information released by the related parties there. It is especially before the Fomc meeting which will be held onNov. 2.
The far-from-expected results again raised the fears of a faltering acceleration in America’s economic growth. However, the Fed's tapering is not expected to be delayed because of this.
The reason is that the employment report other than NFP tonight cannot be said to be bad. It’s clear that the headline release was missed. However, the underlying details are not too severe.
Dollar is just Slipped Due to a Tapering Expectation
Ultimately, the United States Employment number is still consistent with the Fed's plan to deliver a stimulus reduction announcement next month. That was stated by Mazen Issa as an analyst at TD Securities.
Elsewhere, the tapering expectation by the Fed is not disturbed. That is why; dollar is just slipped so far in the market. It is a quite good position for that major currency.
In response to tonight's data, the U.S. dollar appears to be fairly stable. The dollar index was trading at 94.17 which means not far from the Oct. 06 high and that is great.
That currency Price Action suggests that the market participants are still seeing the optimism. That is why; the expectations for a tapering decision are still being held around November or December
The Market Needs More Economy Data
The first (outlook) of a rate hike hovering is around autumn 2022. That opinion was stated by Karl Schamotta as an analyst at Cambridge Global Payments in Toronto.
Another analyst named Mazen Issa added that while the United States NFP numbers were disappointing, the weakness was likely to last only in a short period of time.
The market needs more employment data that ensures a weakening and support the predictions made. In the other case, it will block the Fed's monetary tightening.
Previously, the fairly convincing economic data in America lately has also raised the expectations for a higher non farm payroll data. In fact, this condition comes with some effects.
The Predictions Made by the Consensus Before
The situation above was opening up the possibility of tapering rates and faster rate hikes. Some of the brilliant data include ADP Non-farm Employment Change. It is also included the employment subindex in the ISM Manufacturing PMI report.
It is known that the concensus has made several predictions due to this situation before. From the data it is known that the Consensus expects non-farm payrolls to add an additional 500,000 jobs in the United States.
It is especially for the September period. However, the reuters survey results show that the experts' estimates range from 250,000 to 700,000. So far, the data was surprising some people, but the rests of them were ready.
