6 Dec 2013
Flash: Danger of a soft NFP on Friday - Westpac
FXstreet.com (Bali) - According to Sean Callow, FX Strategist at Westpac, risk is skewed towards a softer-than-expected NFP on Friday.
Key Quotes
"Bloomberg lists 185K as the median forecast for US Nov non-farm payrolls, a bullish forecast reflecting the big miss last month, when consensus was 120K versus the actual headline 204K."
"Given Westpac’s view that the economy is not growing strongly in Q4, we both flag the danger of downward revisions and opt for a soft 140K forecast. The range is 115K to 230K. But since the Fed’s formal policy trigger is not payrolls but the unemployment rate, this should also be watched closely."
"Consensus is 7.2% vs Oct’s 7.3% but we expect no change. The household survey reported a steep drop in Oct employment; at some point these surveys need to converge again. If we are about right on our jobs forecast then AUD/USD should rally to the low-mid 0.91s but a 200K NFP headline would probably see a slide through 0.9000."
Key Quotes
"Bloomberg lists 185K as the median forecast for US Nov non-farm payrolls, a bullish forecast reflecting the big miss last month, when consensus was 120K versus the actual headline 204K."
"Given Westpac’s view that the economy is not growing strongly in Q4, we both flag the danger of downward revisions and opt for a soft 140K forecast. The range is 115K to 230K. But since the Fed’s formal policy trigger is not payrolls but the unemployment rate, this should also be watched closely."
"Consensus is 7.2% vs Oct’s 7.3% but we expect no change. The household survey reported a steep drop in Oct employment; at some point these surveys need to converge again. If we are about right on our jobs forecast then AUD/USD should rally to the low-mid 0.91s but a 200K NFP headline would probably see a slide through 0.9000."