NFP Report Preview 6th July 2012 – US Employment event Risk
It is widely forecast that the U.S. economy will have added around 100k jobs for the month of June 2012, this would be an increase on the previous month but still lower than the anticipated 150k jobs forecast in May which shows the market has adjusted expectations following the previous months dispointing figure.
EURUSD | 6th July
It is thought that US employers may not have invested as heavily in the workforce this June as they were concerned around issues in Europe, and the high cost of energy.
The 69k reading in May was a surprise for the financial market as they were expecting a reading of approx 150k new jobs.
They has been talk of further easing from the FED (Federal reserve), and despite the extension of Operation Twist at the June FED meet, any continuation of a weak job market scenario may see the widely discussed “QE3” asset purchase program becoming a reality.
Market participants became more optimistic around the expected NFP figure for June after the ADP employment report showed a 176k increase for the private payrolls figure, this was better than the 108k forecast level. The ADP is not always the most reliable leading indicator though and all eyes will be on the official figure today.
The currency majors are trading in a small range today prior to the release of the NFP figure with the key EURUSD pair consolidating just above the 1.2363 low printed yesterday.