NFP

The non-farm payroll (NFP) report is a significant economic indicator of the U.S. economy released by the Bureau of Labor Statistics (BLS) under the “Employment Situation" report. The report measures the numbers of workers in the U.S. employed in goods, manufacturing and construction, which make up 80% of the U.S. workforce. Excluding farm employees, government employees, private household employees, and non-profit employees.

The number of jobs added or lost to the U.S. economy indicates the state of the U.S. economy, and can influence the Federal Open Market Committee (FOMC) interest rate decision.

• The unemployment rate
• Number of jobs added or decreased in a specific sector
• The U.S. average hourly earnings

Traders closely watch this monthly report, due to its potential to influence global markets, create market movements, and cause volatility. Analysts and traders try to speculate on the upcoming NFP data ahead of the official report.

Which markets affected most by the Non-farm payroll report?

The U.S. dollar and Forex currency pairs such as EUR/USD, GBP/USD, AUD/USD are hugely influenced by the non-farm payrolls data. Generally, If the data shows a healthy U.S. economy with growth and jobs added, the U.S. dollar is strong. On the other hand, a declining economy with a growing unemployment rate and a possible interest rate cut can cause traders to turn for stronger currencies.

The NFP report also affects gold. For example, in the case where the report’s data shows that state of the U.S. economy is declining, and the U.S. dollar seems weak to traders, traders might turn to safe haven assets like Gold.

The report is released on the first Friday of each month, an hour before the opening of the U.S. Stock market.