Nfp Preview: Forecasts From 10 Major Banks For August Jobs Report, Data Critical To Fed's Tapering

Nfp Preview: Forecasts From 10 Major Banks For August Jobs Report, Data Critical To Fed's Tapering

  • Market News
  • Special Report
  • 2021, 03 September

The US Bureau of Labor Statistics (BLS) is set to release the August jobs report on Friday, September 3 at 12:30 GMT, and as we get closer to the release time, here are the forecasts by the economists and researchers of 10 major banks regarding the upcoming employment data. An increase of 750,000 jobs is expected but the whisper number is lower after weak data.

The USD has been stuck at the lows in typical pre-Nonfarm Payrolls tension. How low can the dollar go? Extremely low expectations point to a greenback comeback,.

Westpac

“As the economy continues to re-open, we expect another extraordinary month of job creation in August, circa 850K. The household survey is likely to report another decline in the unemployment rate in August, though the scale of this latest fall is anticipated to be modest at just 0.2ppts, taking the unemployment rate down to 5.2%. The reason this is the case is that participation should rise as unemployment benefits cease and workers who have stayed home to care for their family begin to return to the labour force. This will be a process that takes more than a year, but should gather pace in coming months.”

RBC Economics

“The US labour market recovery is expected to have continued in August with employment rising sharply (730K) once again after gains of just under a million jobs in each of June and July. The unemployment rate is seen at 5.4%.”

ING

“The consensus is looking for 750K job creation for August while we think something closer to 675K. It may be that we need to see another 900K figure to tip the odds back in favour of a September taper.”

NBF

“Hiring should have continued at a strong pace in the month, as the improving epidemiological situation allowed the re-opening of broad swathes of the economy. Layoffs, meanwhile, could have gone down a bit, judging from the decrease in initial jobless claims between the June and July reference periods. All told, payrolls may have increased 750K in the seventh month of the year.”

CIBC

“Hiring looks to have continued at a brisk pace in August, as signalled by a further drop in jobless claims. Higher wages and recruitment efforts likely fuelled a net gain of 900K jobs. The lofty gain in jobs could cause the unemployment rate to fall to 5.2% even as participation in the labor force looks set to have increased. Wage gains could have decelerated to 0.3%, still a strong print that would reflect the ongoing labor shortage. We are above the consensus which could be supportive for the USD and bond yields.”

TDS

“We expect this week's report for August to disappoint; we are forecasting a 400K rise in payrolls, a strong number by pre-COVID standards but down sharply from 943K in July and well below the current 750K consensus. Hiring has probably been held back to some extent by factors temporarily limiting labor supply, resulting in some upward pressure on wage gains. Those factors will likely ease over time, but we forecast another relatively strong rise in average hourly earnings: 0.4% MoM, with the 12-month change staying at 4.0%.”

SocGen

“Our forecast for a 690K gain is less than June and July, but private sector jobs and job gains in sectors reopening remain strong. There are two key reasons for a more modest increase in August versus the 943K increase in July. First and most immediately important is fewer education jobs. Despite the recent jump, education payrolls are still 581K below their February 2020 levels. We expect these losses to be fully made up, just not so fast. For August, we expect education payrolls up 115K, of which 90K are public jobs. A second reason for fewer private jobs – our forecast is for 600K versus 703K in July – is the shrinking pool of job losses. We expect the unemployment rate to drop further, to 5.2% in August. This is an aggressive drop. In July, the unemployment rate dropped 0.5pp to 5.4%.”

Credit Suisse

“We are forecasting 850K, above consensus of around 750K, partly based on some evidence that states that ended extra unemployment benefits early have seen some increase in job seeking.”

Wells Fargo

“We have dialed back our August payroll number to an increase of 750K.”

Deutsche Bank

“We see NFP growing by 700K in August, which follows an 11-month high of 943K in July, and that in turn should see the unemployment rate fall to a fresh post-pandemic low of 5.2%. One caveat they do note, however, is that historically the August report has disappointed consensus expectations, so it’ll be interesting to see if that happens again.”

Danske Bank

“The weak ADP report on Wednesday has probably lowered market expectations a bit. We still expect a strong print but most likely still below 1 million.”

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