Loading ...Trading Implications
Labor market indicators generally improved this month: The ADP national employment report ticked up to 213k from 204k last month, while initial jobless claims continued their steady decline to 281k new claims in the survey week, one of the lowest readings for an NFP survey week in the past 15 years! However, we did see Manufacturing PMI employment drop 3.5 points to 54.6, and the generally reliable Services PMI survey will not be released until after tomorrow’s headline NFP report.
Trading Implications
Last month, the historic streak of six consecutive months of 200k+ job growth ended abruptly with a disappointing 141k reading. Looking at the preponderance of labor market data, it appears likely that last month’s report was a one-off outlier rather than the beginning of a new, slower trend in job growth. Recent Federal Reserve comments support this view, as the central bank prefers to look at trends in economic data, rather than single data points. That said, the US dollar remains vulnerable to a correction after its massive run higher, so another disappointing reading could provide the catalyst for a big reversal in the greenback.
http://www.fxstreet.com/analysis/indices-insider/2014/10/02/07/