U.S. Nonfarm Payrolls Expected to Remain Weak in August

Huoxing Finance reports that on September 4, at 8:30 PM Beijing time, the U.S. will release the August non-farm payrolls report. The market expects an increase of 56,000 non-farm jobs, following an unexpected decline of 23,000 in July. Economists’ forecasts range from a decrease of 25,000 to an increase of 121,000, reflecting significant divergence in views on labor market conditions. The unemployment rate is expected to remain at 4.1%, though some economists anticipate a rise to 4.2%; annual wage growth is projected to slow from 3.2% to 3%. Morgan Stanley’s chief economist, Michael Gapen, estimates that the revocation of temporary protected status for Haitian immigrants could reduce non-farm payrolls by approximately 15,000, while rebounds in employment in local government education, leisure, and hospitality sectors may provide support. Most economists believe that unless the non-farm data shows a major surprise, the report is unlikely to directly determine the Fed’s interest rate decision at its September 15–16 meeting; market focus will shift to next week’s CPI. Fed Governor Waller explicitly stated on Thursday that if upcoming data confirms that inflationary pressures are easing, he would favor maintaining rates unchanged this month. Currently, the market prices in a 50% probability of a September rate hike, down from 63.2% on Wednesday.