4 Mar 2016
US NFP: Likely to stuck in low gear - TDS
Research Team at TDS, suggests that the US labor market momentum is expected to remain stuck in low gear in February, with the economy adding a relatively modest 168K jobs.
Key Quotes
“This will only be marginally higher than the equally disappointing 151K jobs added the month before, and it remains well below the relatively brisk 230K average monthly pace of jobs created last year. Much of the job gains should be centered in the pro-cyclical sectors such as professional services and retail, while government services should also add a respectable 12K jobs to the bottom-line. Employment in the manufacturing sector should decline modestly, falling 10K in February as some of the unsustainable 40K jobs added in January are surrendered.
Despite the relatively subdued pace of jobs growth, this will still be consistent with further slack absorption in the labor market. As a result, wages should rise modestly gaining a further 0.2% m/m following the robust 0.5% m/m advance the month before. The risks to this call are to the downside. The unemployment rate should rise modestly, climbing to 5.0% from 4.9%, on account of weaker household employment performance. The overall tone of this report should be weak, reflecting the slowing in underlying US economic momentum, underscoring the case for caution at the Fed.”
Key Quotes
“This will only be marginally higher than the equally disappointing 151K jobs added the month before, and it remains well below the relatively brisk 230K average monthly pace of jobs created last year. Much of the job gains should be centered in the pro-cyclical sectors such as professional services and retail, while government services should also add a respectable 12K jobs to the bottom-line. Employment in the manufacturing sector should decline modestly, falling 10K in February as some of the unsustainable 40K jobs added in January are surrendered.
Despite the relatively subdued pace of jobs growth, this will still be consistent with further slack absorption in the labor market. As a result, wages should rise modestly gaining a further 0.2% m/m following the robust 0.5% m/m advance the month before. The risks to this call are to the downside. The unemployment rate should rise modestly, climbing to 5.0% from 4.9%, on account of weaker household employment performance. The overall tone of this report should be weak, reflecting the slowing in underlying US economic momentum, underscoring the case for caution at the Fed.”