Currency Analyst since 2010

NFP: projected impact on USD

The US is due to release NFP (Non-farm Payrolls) figures at 12:30 GMT.

Forecast: 230K

Previous reading: 288K

NFP 6-month average: 231K

ADP came at 218K vs. 281K in June and vs. the forecast of 234K

Initial jobless claims 4-week moving average: 297K vs. 314K at the time of the June jobs report

The employment component in discouraging Chicago PMI has actually improved and the Philly Fed employment component was slightly better.

If NFP comes above 200K this would be a sixth straight month that employment has expanded by more than 200K, a stretch not seen since 1997. Analysts at Standard Chartered Bank think that the threshold for a positive surprise is 250K: a reading above this level may bring USD/JPY to 103.50/104.00. However, Standard Chartered expects NFP to come below 200K which will make USD/JPY slid to 102.50.

Analysts at BNP Paribas expect NFP to increase by 225K. If their forecast comes true, the market will be focused on the possibility that the Fed begins tightening policy in the first half of 2015 keeping US yields and the USD supported.


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