US: All eyes on NFP today – Rabobank

According to Rabobank analysts, today’s Non-Farm Payrolls in the US for March is one of the key reports to watch.

Key Quotes

“The ADP figures released earlier this week surprised to the downside, but given the recent distortions due to the partial government shutdown, there is additional uncertainty surrounding the March figures.”

“Following a slow 20K jobs gain in February, the consensus is looking for a 177K gain in March, basically re-establishing monthly jobs growth at the lower end of the range of previous years. More important perhaps are the average hourly earnings data.”

“Last month, earnings growth reached 3.4% y/y, its highest level since April 2009 and – given the tightening labour market – providing some support for the view that the tightening labour markets is slowly but surely starting to exert upward pressure on wages.”

“Although it would require a fairly strong monthly 0.3% gain to maintain the annual growth rate at its February rate, one can only assume that – against the backdrop of the Fed’s recent U-turn – it is the assumption among policy makers that the labour market recovery is in its final stages and will soon reverse. If not, expect an interesting debate to develop at some point.”