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What Wall Street Expects From Today's Payrolls Number

Tyler Durden's picture




 

Here are the consensus numbers that Wall Street expects out of today's NFP print:

  • US Change in Nonfarm Payrolls (Dec) M/M Exp. 240K (Low 160K, High 305K), Prev. 321K, Oct 243K
  • US Unemployment Rate (Dec) M/M Exp. 5.7% (Low 5.6%, High 5.8%), Prev. 5.8%, Oct 5.8%
  • US Average Hourly Earnings (Dec) M/M Exp. 0.2% (Low 0.0%, High 0.3%), Prev. 0.4%, Oct 0.1%
  • Whisper number: 270K

The breakdown by bank:

  • Deutsche Bank 200K
  • HSBC 211K
  • Citigroup 220K
  • Goldman Sachs 230K
  • Morgan Stanley 240K
  • JP Morgan 240K
  • Credit Suisse 250K
  • UBS 270K

Some further details and market reaction speculation courtesy of RanSquawk:

December’s NFP report is expected to show another month of strong employment growth with a median consensus number of 240K, marginally above the year-to-date average (228K) but down from November’s bumper figure of 321K jobs. The majority of analysts also expect the unemployment rate to drop by a tenth to 5.7% following November’s stellar employment report and the subsequent upwards revision to Q3 GDP. However, recent employment indicators have been mixed with the employment component in the ISM Manufacturing reading increasing from November but the same component in the ISM Non-Manufacturing data did see a marginal fall from the previous month. This week’s ADP figure came in above expectations at 241K with November’s reading also revised higher, showing a continued trend of employment growth. Elsewhere, the 4-week average of unemployment claims remains near its lowest level since 2000 and well below the 300K mark.

Labour data will take on increased importance this year as the Fed moves ever closer to rate lift-off. The FOMC minutes from the December meeting reiterated that monetary policy is to be data dependent and that officials see a rate rise before April as unlikely. Furthermore, most Fed officials saw no clear evidence of a broad-based acceleration in wages although a few participants suggested that the recent uptick in average hourly earnings could be a cautious sign of an upturn in wage growth. Of note, average hourly earnings is expected to slightly fall to 0.2% in December.

Market Reaction

A headline reading above the median expectation of 240K could well support equity markets and the USD although the greenback already resides near its highest levels since 2005. Treasuries could also see some curve steepening in the aftermath of a strong employment report with possible scope for downside after the 10y yield fell below 1.9% for the first time since 2013 earlier this week. In terms of major long-term implications, the recent trend has been one of steady employment growth and another figure in advance of 200K should do little to alter current market expectations of a Fed rate hike in mid-2015. However, a headline figure vastly out of sync with recent numbers has the potential to alter Fed thinking given the change in forward guidance and rhetoric concerning data dependency.

 

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Fri, 01/09/2015 - 09:11 | 5640992 Seasmoke
Seasmoke's picture

Here we go again with this ridiculous number. Whatever they make it. Gold will get smashed 

Fri, 01/09/2015 - 09:14 | 5640996 economics9698
economics9698's picture

Seriously does anyone pay attention to this seasonally adjusted bull shit?

Fri, 01/09/2015 - 09:26 | 5641044 neuronius
neuronius's picture

These numbers are like Obama's budget numbers, fuzzy maff.

Meaningless.

Fri, 01/09/2015 - 09:35 | 5641075 eclectic syncretist
eclectic syncretist's picture

Exect the paint the data by numbers game to continue, with rosy employment numbers opening the door to higher interest rates.  The numbers are being shaped around a policy.

Fri, 01/09/2015 - 09:39 | 5641095 TruthInSunshine
TruthInSunshine's picture

Chewy "The Bagel" Jewman: 666,666

Yellen, her Jewness, will declare she wanted a million because she's "for the middle-class," then throw more free money at the JewBanks.

Fri, 01/09/2015 - 09:15 | 5640999 linniepar
linniepar's picture

I too can play the guessing game! 187,000!

Fri, 01/09/2015 - 09:13 | 5640998 FABBAS
FABBAS's picture

I EXPECT 135K IN TODAY PAYROLL NUMBER

Fri, 01/09/2015 - 09:15 | 5641010 CaptainObvious
CaptainObvious's picture

Make sure you have a fudge factor for revising that downward because of weather, just like the big boys do.

Fri, 01/09/2015 - 09:15 | 5641007 ifishivote
ifishivote's picture

It could be 0 or 500,000, the market is heading higher.

Fri, 01/09/2015 - 09:17 | 5641011 jmcadg
jmcadg's picture

Under 200k. Dow up 200 points! Mooooaaaarrr of the same shit.

Fri, 01/09/2015 - 09:41 | 5641094 SmallerGovNow2
SmallerGovNow2's picture

"they" will make the number what ever they want it to be with "X" adjustment(s)...

Fri, 01/09/2015 - 09:18 | 5641020 yogibear
yogibear's picture

"Whatever they make it. Gold will get smashed"

That's the idea when your a central banker printing infinite fiat. 

Fri, 01/09/2015 - 09:23 | 5641030 RogerMud
RogerMud's picture

if USDJPY keeps dropping it's going to unwind the carry trade in a hurry

Fri, 01/09/2015 - 09:34 | 5641067 Ness.
Ness.'s picture

Fewer people working making less money.  Buy stocks

Fri, 01/09/2015 - 09:38 | 5641083 yogibear
yogibear's picture

The Federal Reserve and Wall Street trying to make stocks the only game around.

Place your bets in the casino.

Fri, 01/09/2015 - 09:40 | 5641099 Caleb Abell
Caleb Abell's picture

Better yet, have the people who aren't working buy stocks.

Fri, 01/09/2015 - 09:43 | 5641092 Dr. Engali
Dr. Engali's picture

Liarman on CNBS can't figure out why participation is so low and wages are falling. Hey dumb fuck, people are forced to work multiple part time jobs thanks to zero care and we have a never ending flow of cheap labor coming in from the south.

Fri, 01/09/2015 - 09:39 | 5641093 LawsofPhysics
LawsofPhysics's picture

Wall street expet more free money, period.  They are getting it so long as ZIRP is in play.

Fri, 01/09/2015 - 09:43 | 5641109 Baby Eating Dingo22
Baby Eating Dingo22's picture

Didn't matter what the number, futures were down and PPT needed some cover to correct and sling higher

Next comes the MSM chorus to splain to the sheepie why market is higher

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