Dollar treads water as all eyes turn to U.S. jobs report
The dollar held steady on Friday as investors awaited the most closely watched data set of the month, the U.S. non-farm payrolls report, for clues as to whether the Federal Reserve is to raise U.S. interest rates this year
Solid U.S. employment gains expected in August; jobless rate seen falling
U.S. employment growth likely moderated in August after two straight months of hefty gains, but was probably still strong enough to push the Federal Reserve to raise interest rates later this year.
Nonfarm payrolls likely increased by 180,000 jobs last month, according to a Reuters survey of economists, around this year's monthly average job growth. The unemployment rate is forecast falling one-tenth of a percentage point to 4.8 percent.
The Labor Department will release its closely watched employment report on Friday and readings in line with expectations would reinforce views that the economy has regained speed after almost stalling in the first half of the year.
What’s a Good Print for Payrolls?
Nonfarm payroll growth has slowed in 2016 compared to the breakneck pace of the past two years. The slowdown has some market watchers concerned that the economy is losing steam. In this report, we estimate the number of jobs needed to keep the unemployment rate steady and employ that estimate as a benchmark for a “good” payrolls number. The bottom line is that fewer jobs are needed today to hold the unemployment rate steady.
While demand for labor drives hiring in the short term, labor supply is the key driver of job growth over the long term. Weaker population growth and a decline in labor force participation, brought about by an aging workforce, point to a lower trend rate of employment growth over time. We estimate that nonfarm payrolls will need to rise by 70,000-100,000 per month between now and the end of 2020 in order to keep the unemployment rate stable. This is a lower threshold than previous cycles, when the trend rate of job growth averaged around 150,000 in the 1990s and 120,000 in the early 2000s. The slowdown in job growth since the start of the year therefore indicates that while slack is not declining as quickly, it is still plenty strong enough to lead to a tighter labor market.
Oil heads for biggest weekly loss since mid-January
Crude prices rose on Friday after losses of more than 3 percent a day earlier, with investors treading cautiously ahead of key U.S. employment data that will help gauge the health of the world's largest economy and oil consumer.
Brent crude LCOc1 had climbed 34 cents to $45.79 a barrel by 0650 GMT (0250 ET), while U.S. West Texas Intermediate crude futures CLc1 were up 36 cents at $43.52 a barrel, buoyed by a weaker dollar.
Though rising in this session, Brent and WTI are on track for their biggest weekly losses since mid-January, hit by oil inventory builds and weak U.S. manufacturing data.
Reference : Wells Fargo,Reuters
Thai
Eng