US NFP to grow at a relatively soft 153k pace - TDS

Research Team at TDS, suggests that the anticipation for August nonfarm payrolls will come to an end today and TD expects payrolls to come in below the healthy 180k consensus due to a historical seasonal quirk for August that has caused payrolls to fall short of the consensus forecast in 14 of the last 19 years.

Key Quotes

“We look for payrolls to grow at a relatively soft 153k pace while the unemployment rate should edge lower to 4.8%. Average hourly earnings should also disappoint, with TD calling for a flat print due to unfavourable calendar effects while the market looks for a 0.2% m/m gain. 

The July international trade report will be released simultaneously though it will likely be ignored due to the competing nonfarm payrolls and last week’s advance goods trade report. TD looks for the trade deficit to narrow by $4.5bn to $40.0bn after the strong goods trade numbers reported last week; the market is slightly less upbeat and expects a $41.4bn deficit.

Later in the morning we will receive the ISM New York index as well as factory orders for July, which TD expects to come in slightly firmer than consensus at 2.8% m/m versus the market at 2.0% m/m.”