As reported by Reuters in one of their latest polls, most market participants are anticipating a bullish showing for US Non-Farm Payrolls.
Key quotes
“Nonfarm payrolls probably rose by 191,000 jobs last month after gaining 157,000 in July, according to a Reuters survey of economists. The Labor Department will publish its closely watched employment report on Friday at 8:30 a.m. EDT. (12:30 GMT)”.
Analysts said the administration’s $1.5 trillion tax cut package and increased government spending were shielding the economy from the trade tensions, which have also seen Washington engaged in tit-for-tat tariffs with other trade partners, including the European Union, Canada and Mexico.
They also noted that the import duties implemented so far have affected only a small portion of the American economy, but warned this could change if President Donald Trump pressed ahead with additional tariffs on Chinese imports.
“The economy is on an adrenalin rush,” said Ryan Sweet, senior economist at Moody’s Analytics in Westchester, Pennsylvania. “Given the amount of fiscal stimulus that the economy is benefiting from, it’s going to take a lot to get it off that high.”
Global outplacement firm Challenger, Gray & Christmas said on Thursday there were 521 tariff-related job cuts in August, but these were largely offset by the hiring of 359 workers by steel producers.
August job growth could, however, fall short of expectations because of a seasonal quirk. Over the past several years, the initial August job count has tended to exhibit a weak bias, with revisions subsequently showing strength.
For now the vibrant labor market is not generating wage inflation, which likely reduces the prospect of the economy overheating. Average hourly earnings are forecast increasing 0.2 percent in August after rising 0.3 percent in July.
That would keep the annual increase in wages at 2.7 percent in August. Annual wage growth has remained below 3 percent since mid-2009. Moderate wage gains have been blamed on low productivity growth and are also seen as an indication that there is still some slack in the labor market.”
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