US: NFP a bit of a damp squib! - MUFG

Derek Halpenny, European Head of GMR at MUFG, can’t recall the last time when the jobs report from the US holds as little importance as today.

Key Quotes

“Even a shockingly weak report probably wouldn’t sway the FOMC away from a rate hike on 14th December given it is fully priced and given the potential stimulus that lies in wait for the US economy in 2017. A strong report merely confirms the rate hike that’s priced. So it’s hard to envisage a scenario of any large financial market reaction to today’s report. Certainly a print way out from the 180k consensus is required to trigger any notable reaction.”

“For what it’s worth our NFP model gives us an estimate of 198k for today and we expect other parts of the report to strengthen the belief that one of the key developments for the economy next year will be accelerating wage growth that continues to help consumer spending. At the margin today’s NFP report should help support the dollar by confirming the recent strengthening of the economy that has been evident in other data of late.”