Wow!244K just smashed expectations.
268K private sector payrolls killed.
Once again, the economy made all the experts look like total fools.
There were a few weak spots.
Average hourly earnings grew 0.1% vs. 0.2% expectations.
The market is rallying on the news.
At 8:30, the April non-farm payrolls report is released. We’ll obviously be covering LIVE.
The market is eerily quiet right now. US futures are basically.
Here are the full numerical expectations:
- Change in nonfarm payrolls: +185K (vs. 216K in March)
- Change in private payrolls: +200k (vs. +230K in March)
- Change in manufacturing payrolls: +20K (vs. 17K in March)
- Average hourly earnings month over month: +0.2% (vs. 0.0% in March)
- Average weekly hours: 34.3 (vs. 34.3 in March)
- Unemployment rate: 8.8% (vs. 8.8% in March)
Put in your own guesses in the comments.
Meanwhile, this from Steven Englander is interesting regarding the expectations game:
On payrolls — the consensus is at 185k, Citi at 160k. Looking at the most recent NFP forecast updates, the consensus may have shifted down to 170/175k but not much lower. We think that below 140k payrolls will be viewed unambiguously as a risk off event, even if rates adjust downwards. Both positioning and the market logic suggests that risk-correlated currencies and assets in general are priced for robust global growth, and weak payrolls will crystallize concerns that have been emerging this week that the growth assumption may be shaky.
In the case of NFP today, bad news is bad news.
On the upside a number above 210k should be considered a positive surprise. On a modest upside surprise we expect an initial round of buying of risk assets, but it may not last. To entrench a positive outlook, investors would need support from revisions as well as a big upside surprise. The downside surprise forecast by our economists seems more likely than the upside.
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