EUR/USD 1.15192
-0.165%
Gold 4676.00
-1.726%
Oil 103.832
10.230%
USD/JPY 159.628
0.021%
GBP/USD 1.31964
-0.223%
GBP/JPY 210.627
-0.173%
Browse More
  • English
  • 简体中文
  • 繁體中文
  • Tiếng Việt
  • ไทย
  • Indonesia
Subscribe
Real-time News
Market news: Türkiye will raise the average price of natural gas for residential users by 25%, while the price for industrial users will increase by 18.61%.According to the Wall Street Journal, the latest efforts by regional countries, led by Pakistan, to broker a ceasefire between the US and Iran have stalled.On April 4th, local time, Chief U.S. District Judge James Boasberg of the District of Columbia rejected the Justice Departments request to retry the criminal case against Jerome Powell, after his ruling blocked a subpoena issued in connection with the criminal investigation. In his March 13th ruling, Boasberg stated that the subpoena issued to the Federal Reserve Board in January of last year was for improper purposes, aimed at forcing Powell to agree to Trumps conditions demanding a swift interest rate cut or his resignation. The subpoena for Powell was issued by Washington D.C.s top federal prosecutor, Jeanine Piro (a staunch Trump supporter), who has pledged to continue the investigation and stated that her office is prepared to appeal to the U.S. Court of Appeals for the District of Columbia Circuit. Sources indicate that senior Justice Department officials support the appeal decision. This appeal could delay the confirmation of Kevin Warshs nomination as Federal Reserve Chair. Senator Thom Tillis, a Republican member of the Senate Banking Committee, has criticized the investigation into Powell and has vowed to continue blocking Warshs nomination while the appeal process continues.April 4th - According to Oxford Economics, the US March employment figures significantly overestimated the strength of the pre-war job market, as the data reflected declines in both the labor force and household employment. Job growth will slow as the war in Iran impacts real economic activity. The wars impact on inflation is immediate, but its negative effects on consumer spending, business investment, and hiring will become more apparent in the coming months. Oxford Economics baseline forecast remains that the Federal Reserve will ignore the one-off shock of rising oil prices this year and cut interest rates twice to guard against any future weakness in the labor market.A U.S. judge refused to reconsider the ruling in the investigation against Federal Reserve Chairman Jerome Powell.

What impact does NFP have on the forex market?

LEO

Oct 25, 2021 13:27

Nonfarm payroll employment is a compiled name for goods, construction and manufacturing companies in the US. It does not include farm workers, private household employees, or non-profit organization employees.

It is an influential statistic and economic indicator released monthly by the United States Department of Labor as part of a comprehensive report on the state of the labor market.

The Bureau of Labor Statistics releases data on the first Friday of the month, at 8:30 a.m. Eastern Time. 

This data is analyzed closely because of its importance in identifying the rate of economic growth and inflation.

Nonfarm payroll is included in the monthly Employment Situation or informally the jobs report and affects the US dollar, the Foreign exchange market, the bond market, and the stock market.

The markets react very quickly and most of the time in a very volatile fashion around the time the NFP data is released. The short-term market moves indicate that there is a very strong correlation between the NFP data and the strength of the US dollar. Historical price movement data shows a small negative correlation between the NFP data and the US dollar Index.

The figure released is the change in nonfarm payrolls (NFP), compared to the previous month, and is usually between +10,000 and +250,000 during non-recessional times. The NFP number is meant to represent the number of jobs added or lost in the economy over the last month, not including jobs relating to the farming industry.

As with other indicators, the difference between the actual non-farm data and expected figures will determine the overall impact on the market. If the non-farm payroll is expanding, this is a good indication that the economy is growing, and vice versa. However, if increases in non-farm payroll occur at a fast rate, this may lead to an increase in inflation. In forex, the level of actual non-farm payroll compared to payroll estimates is taken very seriously. If the actual data comes in lower than economists' estimates, forex traders will usually sell U.S. dollars in anticipation of a weakening currency. The opposite is true when the data is higher than economists' expectations.

Suggestion