The 'Whisper Number' For Tomorrow's Jobs Report Set The Bar Low

When the Bureau of labour Statistics publishes the April jobs report tomorrow, economists expect to learn that the economy added 140,000 nonfarm payrolls during the month.

That number is based on a Bloomberg survey.

However, according to TD Securities’ Millan Mulraine, the market is pricing in a lower number thanks to Wednesday’s bad ADP jobs number. From Mulraine’s note:

Even though the current market consensus is for 140K, the post-ADP price action suggests that the true position in the market (the whisper number) may be for something closer to 125K. Our expectation is for an upside surprise, and we expect an asymmetric response favouring upside surprises. Risk-reward favours going short Treasuries into this number. To be sure, we suspect that slowing growth momentum and uncertainty related to the impact of fiscal austerity have tempered hiring activity. However, we believe that the economy is in better shape than last month’s 88K payrolls print suggests.

In other words, if the nonfarm payrolls number comes in above 125,000, all things being equal the markets should react positively.

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