Nonfarm Payrolls in the US rose by 261,000 in October, the data published by the US Bureau of Labor Statistics revealed on Friday. This reading came in much higher than the market expectation of 200,000. Additionally, September’s reading got revised higher to 315,000 from 263,000. Every trend has a countertrend – and low expectations ahead of the Nonfarm Payrolls have contributed to the reaction. The Dollar is responding positively to the relatively upbeat data. The US gained 263,000 in November, better than 200,000 but below 284,000 in October, according to the revised data.

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Gold trades marginally lower on Monday at around $1,784 as the USD recovers its poise. The Greenback fell throughout the first half of the day, despite the poor performance of high-yielding equities, yet it recovered following the US opening, despite the better tone of Wall Street. AUD/USD trades near a Monday low of 0.6728, and risks another leg south in the near term. Everybody gets a raise – whether it is the Great Resignation or not-so-great factors, Americans’ salaries are rising on a broad base. The headline Average Hourly Earnings MoM has missed with only 0.3% vs. 0.4%.

What is the Non-Farm Payroll (NFP)?

The data on nonfarm payrolls is collected by the Bureau of Labor Statistics and put in its monthly “Employment Situation” report, which also includes the unemployment rate. When employment is high and in good economic health, politicians non farm payroll pursue a contractionary monetary policy with high interest rates. Thus, if the unemployment rate is higher than usual, the economy is considered to be operating below its potential and politicians will try to stimulate it.

Please note that this strategy can be applied to any currency pair that includes the US dollar as either the base or counter currency. The information in this site does not contain investment advice or an investment recommendation, or an offer of or solicitation for transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. Every tenth in US Core CPI makes a difference as https://www.bigshotrading.info/ markets await the Fed. Ranges between 0.2% to 0.6% are plausible each means something else for the Dollar. Nonfarm Payrolls rose by 431,000 in March, below the median economist forecast for a 490,000 rise, data published by the US Bureau of Labor Statistics showed on Friday. However, the February Non-Farm Payrolls number received a hefty 72,000 upwards revision to 750,000 from 678,000, more than making up for the 59,000 miss on the March headline expected number.

NFP Quick Analysis: A win-win for the dollar, Fed on course for double-dose rate hike

Another approach is to place a trade a few minutes before the figure is released. While this could result in a healthy profit, it is something of a ‘coin-flip’ on market direction as the markets can sometimes initially react contrary to general expectations. Risk management enables you to close the position if that view proves to be incorrect. For instance, let’s assume the payrolls have exceeded expectations and are therefore expected to boost the value of the US dollar against a basket of other major currencies including the pound. Instead, the GBP/USD exchange rate rallies as soon as the announcement comes out, and the pound initially moves sharply higher against the dollar. The non-farm payrolls report is a significant market event each month. Here we examine what it is and how it can affect your forex trading.

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