US NFP Preview: Labour-market conditions likely remained healthy – SocGen

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Delhi) – Research Team at Societe Generale, suggests that US payroll employment growth probably decelerated last month, following the well-above consensus 292,000 leap posted in December, as non-agricultural concerns created an estimated 245,000 net new jobs.

    Key Quotes

    “Several factors point to a downshift in hiring during the reference period from the 284,000-per-month clip set during the fall quarter. Consistent with a modest increase in the pace of pink-slipping, initial claims for unemployment insurance averaged 282,000 over the five weeks leading up to the January establishment period, 11,000 above the relevant prior-period mean and the highest level since last April.

    Meanwhile, the number of persons on regular state benefits rolls expanded by 73,000 between canvasses, suggesting that currently unemployed persons may be having a more difficult time finding work. Hinting that any deceleration in payroll growth likely will be limited, the diffusion index of job gains across the 263 industries canvassed by the BLS hit an eight-month high of 66.2% over the October-December span.

    Although still below the zero mark associated with average real business conditions, the Aruoba-Diebold-Scotti (ADS) Business Conditions Index climbed over the five weeks leading up to the January survey. Finally, temperatures returned to seasonal norms during last month’s canvassing period, but unusually arid conditions across the continental US suggest that weather conditions could still be a mild positive in the upcoming report.”

    December’s admittedly downbeat result, we expect average hourly earnings to have risen by
    an above-consensus 0.4% last month. With the private job count expected to expand by 235,000 during the reference period, total hours worked are forecasted to have climbed by another 0.2%, placing the closely followed proxy for nonfarm business output a modest 0.6% annualized above the October-December average.”
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