#NFPWatch Forecasts and Context
Consensus of the consensus: +110,000 jobs in August, which would be the weakest gain since October 2024.
Such performance is seen as a persistent sign of labor market slowdown, confirming the trend that began with the slowdown in job growth (average ~135,000 over 3 months).
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🔄 Expected Impact on Markets
1. Stocks (S&P 500):
According to JPMorgan, a job creation number between 85,000 and 105,000 would lead to a decline of 0.25% to 1.5%.
Below 85,000: sharper drop (-2% to -3%).
2. Bonds (Treasuries):
A weak report would reinforce the idea of an economic slowdown, favoring a decrease in long-term yields (increase in bond prices).
A robust report could conversely delay the prospect of rate cuts, pushing yields higher.
3. Dollar (USD):
A higher than expected NFP could strengthen the dollar.
Conversely, a weak report would exert downward pressure on the currency.
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🏦 Fed Policy
The Fed is attentive to labor market data, including during "meeting by meeting".
A number well below expectations would strengthen the probabilities of a rate cut by September, as suggested by some analysts.
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🔍 To Watch on Release Day
Actual job creation number (vs +110,000 expected)
Unemployment rate
Revisions for previous months (May, June, July)
Average hourly wage (inflationary pressure index)
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📊 In Summary
Scenario Likely Impact
+110,000 (forecast) Moderate volatility in stocks; anticipation of a possible slowdown by the Fed
< 85,000 Depression for stocks, decrease in USD rate, incentive to cut rates
> 145,000 Increase in the dollar & bond yields; bullish effect on markets