US July Nonfarm Payrolls to Decide Fed Interest Rate Hike Fate
The US Bureau of Labor Statistics is set to release the Nonfarm Payrolls (NFP) data for July on Friday at 12:30 GMT. Investors expect NFP to rise by 80K following June's disappointing print of 57K.
The Unemployment Rate is seen holding steady at 4.2%, while the annual wage inflation, as measured by the change in the Average Hourly Earnings (AHE), is projected to remain unchanged at 3.5%. Economists at Deutsche Bank expect a slightly firmer US labour market print on Friday, projecting that the July payrolls report will show employment growth of +65k, modestly above June's +57k reading.
Fed policymakers remain focused on taming inflation as the labor market shows no signs of a cooldown despite the disappointing June NFP print. A significant downside surprise in the NFP, with a print below 40K, could suggest that the Fed could take its time to ensure that the labor market is not in a downturn before tightening the monetary policy.