U.S. job growth likely picked up in September, with wages increasing solidly, which could relieve nervous financial markets’ concerns.
With signs that the Trump administration’s 15-month trade war with China is spilling over to the broader economy, continued labor market strength is a critical buffer against an economic downturn. The U.S.-China trade war has eroded business confidence, sinking investment and manufacturing and made markets nervous.
Nonfarm payrolls probably increased by 145,000 jobs last month after gaining 130,000 in August. August job growth was probably held back by a seasonal quirk related to students leaving their summer jobs and returning to school. It could be revised higher as has been the trend in the past several years.
Regardless of whether employment growth remains moderate, economists expect the Federal Reserve to cut interest rates.
Despite signs that businesses are becoming more cautious hiring workers, layoffs hit a five-month low in September. The number of Americans filing for unemployment benefits remains near historic lows. September’s anticipated job gains would be below the monthly average of 158,000 this year. This number is still above the roughly 100,000 needed each month to keep up with growth in the working-age population. The unemployment rate is forecast unchanged at 3.7% for a fourth straight month in September.
START TRADINGForex – Markets nervous before US jobs data
Investors now look for clarity on the health of the world’s biggest economy from U.S. jobs data due at 1230 GMT. Some traders are braced for a disappointing result after the surprisingly soft data earlier this week on U.S. manufacturing.
The dollar traded near a one-month low versus the yen, while it was stuck near a one-week trough versus the euro. For the week, the dollar was down 1.04% versus the yen and off 0.3% against the common currency. The greenback edged down to 106.81 yen, close to a one-month low of 106.48 yen reached on Thursday.
The euro rose 0.1% to $1.0970, extending its recovery from a near 2-1/2-year low of $1.0879 set on Tuesday.
The dollar index fell to 98.816, shedding about 0.9% after hitting a 2-1/2-year high this week. It is down 0.3% on the week.
The Australian dollar and the New Zealand dollar held near the day’s highs thanks to broad dollar strength.
The pound rose on Friday and was poised for its first weekly gain in three weeks. Against the dollar, the pound was broadly steady at $1.2334 and was a shade weaker against the euro at 88.96 pence.
Gold prices rose on Friday on growing fears of a global economic slowdown and rising expectations of more U.S. interest rate cuts. Spot gold was up 0.3% at $1,509.66 an ounce, having climbed to its highest since Sept. 25 in the last session. Prices are on track for a weekly gain of about 0.8%.
U.S. crude oil rose 0.63% to $52.78 a barrel, while Brent crude rose 0.54% to $58.02 per barrel.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money