Non Farm Payrolls & US Unemployment Rate
Release URL: http://www.bls.gov/news.release/empsit.nr0.htm - See more at: http://www.forexnews.com/blog/2013/07/05/non-farm-payrolls-and-us-unemployment-rate/#sthash.HmXLUZPz.dpuf
Market Impact Scenarios:Traders eagerly watch out for data on non-farm payrolls and unemployment rate, as the number of unemployed people is an important sign of the overall economic health of the country. Since the U.S. employment report is released shortly after the month ends, the data is considered to be timely. Job creation is a leading indicator of consumer spending because more the income-earning workers, more will be the consumption expenditure. Any worsening of the employment situation will lead to lower incomes, decreased consumption and a drop in economic activity. Thus, a rise in new non-farm payrolls is generally seen as positive (or bullish) for the USD, while a decline in the reading is seen as negative (or bearish) for the currency. Similarly, a low unemployment rate will indicate higher economic activity in the country, increasing the demand for the USD.
Understanding Non Farm Payrolls and the US Unemployment Rate:
The employment report by the US Department of Labor is based on two separate surveys, which help calculate important labor market indicators like unemployment rate, non-farm payrolls, average workweek, and average hourly earnings. Non-farm payroll is the most closely watched figure in the report. It measures the change in the number of employed people in all non-agricultural businesses during the previous month. The unemployment rate is the number of unemployed workers divided by the total labor force. The average workweek reveals the number of hours worked in the non-farm sector, while average hourly earnings denotes the basic hourly rate for major industries as indicated in non-farm payrolls.
- See more at: http://www.forexnews.com/blog/2013/07/05/non-farm-payrolls-and-us-unemployment-rate/#sthash.HmXLUZPz.dpuf
