The US Bureau of Labor Statistics (BLS) on Tuesday reported that non-farm payrolls (NFP) in the United States (US) increased by 64,000 in November. This reading came in better than the market’s expectation of a rise of 50,000. The report also showed that non-farm payrolls declined by 105,000 in October.
The underlying details of the publication showed that the unemployment rate rose to 4.6% in November, compared to market expectations of 4.4%. Over this period, the labor force participation rate increased from 62.4% to 62.5%.
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The change in total non-farm payroll employment for August was revised down by 22,000 to -4,000 to -26,000, and the change for September was revised down by 11,000 to +119,000 to +108,000. With these revisions, combined employment in August and September is 33,000 lower than previously reported,” the BLS noted in its press release.
Market reaction to non-farm payroll data
The US dollar (USD) came under fresh selling pressure with the immediate reaction to non-farm payrolls data sending the USD index falling below 98.00 to its lowest level since early October. At press time, the USD index was down 0.2% on the day at 98.05.
US dollar price today
The table below shows the percentage change in the US Dollar (USD) against the major currencies listed today. The US dollar was the weakest against the British pound.
| USD | EUR | gbp | JPY | scurvy | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.27% | -0.48% | -0.29% | -0.17% | -0.17% | -0.18% | -0.34% | |
| EUR | 0.27% | -0.21% | -0.11% | 0.09% | 0.10% | 0.09% | -0.08% | |
| gbp | 0.48% | 0.21% | 0.10% | 0.30% | 0.31% | 0.30% | 0.14% | |
| JPY | 0.29% | 0.11% | -0.10% | 0.19% | 0.20% | 0.18% | 0.03% | |
| scurvy | 0.17% | -0.09% | -0.30% | -0.19% | 0.00% | -0.00% | -0.19% | |
| AUD | 0.17% | -0.10% | -0.31% | -0.20% | 0.00% | -0.02% | -0.17% | |
| NZD | 0.18% | -0.09% | -0.30% | -0.18% | 0.00% | 0.02% | -0.16% | |
| CHF | 0.34% | 0.08% | -0.14% | -0.03% | 0.19% | 0.17% | 0.16% |
The heat map shows the percentage change of major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select US Dollar from the left column and move to Japanese Yen along the horizontal line, the percentage change displayed in the box will represent USD (base)/JPY (quote).
This section below was published as a preview of non-farm payrolls data at 04:00 GMT.
- Non-farm payrolls are expected to increase by 50K in November after an increase of 119K in September.
- The United States Bureau of Labor Statistics will publish deferred jobs data on Tuesday at 13:30 GMT.
- The US dollar is set to experience sharp volatility on employment data amid rising labor market concerns.
The United States (US) Bureau of Labor Statistics (BLS) will release delayed nonfarm payrolls (NFP) data for October and November at 13:30 GMT on Tuesday.
Volatility around the US dollar (USD) will prompt employment reports for new information on the US Federal Reserve’s (Fed’s) path forward on year-end interest rates.
What to expect from the next nonfarm payrolls report?
Tuesday’s US employment report will be unusual, including data from both October and November. October data will not be complete because BLS will only release indicators from the establishment survey due to collection problems caused by the government shutdown.
Economists expect nonfarm payrolls to rise by 50,000 in November. The market is also eagerly awaiting the October data after the 119,000 jobs increase seen in September.
The unemployment rate (UE) is likely to remain unchanged at 4.4% during the same period.
Meanwhile, a closely watched measure of wage inflation, average hourly earnings (AHE) for October and November will also be published along with the NFP release. AHE increased by 3.8% year-on-year (YoY) in September.
Previewing the employment report, analysts at TD Securities said: “We expect the November employment report to show a jump in job gains to 70k after contracting by 60k in October. The weakness in both months will be driven by the government sector.”
He added, “We also expect the UE rate to rise to 4.5% in November as the labor market gradually softens. Average hourly earnings are likely to rise 0.3% month-on-month (MoM) after a 0.1% decline in October.”
How will US September Nonfarm Payrolls impact EUR/USD?
The US dollar is hanging at two-month lows against its major currency rivals after less hawkish Fed results and ahead of the highly anticipated NFP publication.
Broad USD weakness has sent the EUR/USD pair back above the 1.1700 mark. Will the Chief see additional benefits?
The Fed announced an expected 25 basis points (bps) interest rate cut to 3.5%-3.75% in a 9-3 vote last Wednesday.
Fed Chairman Jerome Powell stuck to his cautious tone at his post-monetary policy meeting press conference, disappointing those who were calling for a more hawkish stance.
Powell said: “First, the labor market continues to cool slowly,” adding that “unemployment has now increased by three-tenths from June to September.”
The market expected two more rate cuts next year, despite the US central bank’s average expectation of a quarter-percentage-point cut next year, which jolted the greenback across the board.
On the economic data front, the Labor Department reported last week that initial claims for state unemployment benefits rose by 44,000, the largest increase since mid-July of 2021, to a seasonally adjusted 236,000 for the week ending Dec. 6.
Meanwhile, the Institute for Supply Management (ISM) Services PMI showed a slight improvement to 52.6 in November compared to 52.4 in October, while Automated Data Processing (ADP) reported US private payrolls unexpectedly declined by 32K in November after a revised 47K increase. Analysts forecast job growth of 5K.
Employment placement firm Challenger, Gray & Christmas said earlier this month that “recent signals from unofficial data point to a massive cut in jobs, with more than 1.1 million layoffs announced by November.”
With rising labor market concerns, also expressed by Powell, the NFP data will be closely scrutinized to help determine the number of Fed rate cuts expected in 2026.
A weaker-than-expected headline NFP release and an unexpected rise in the unemployment rate in November could add to concerns over a slowdown in the US jobs market, increasing the likelihood of another rate cut by the Fed at its next Fed meeting in January. In such a case, USD may see another decline, taking EUR/USD closer to 1.1800.
Conversely, if the NFP beats estimates and the unemployment rate remains at or falls to 4.4%, EUR/USD could come under strong bearish pressure towards 1.1600. A positive surprise in jobs data will push back expectations of more than one Fed rate cut next year, providing much-needed relief to the greenback.
Dhvani Mehta, Asian Session Lead Analyst at FXStreet, offers a brief technical outlook for EUR/USD:
“The main currency pair consolidated near the two-month high of 1.1769, while remaining well ahead of all major daily simple moving averages (SMAs). Meanwhile, the 14-day Relative Strength Index (RSI) flirts with the overbought zone on the daily charts, suggesting there is more scope for upside. Furthermore, the crossover of the 21-day and 50-day SMAs is bullish on the pair. “Increases the ability to.”
“If the bullishness takes hold again, the next resistance is seen at the 1.1800 round level, above which the 1.1850 psychological barrier will be tested. The high of 1.1919 on September 17 will be on the buyers’ radar. On the other hand, any corrective pullback may find initial support at the 100-day SMA of 1.1644. The next demand zone is seen at around 1.1610. Where 21-day and 50-day SMA are hanging, a deeper fall may challenge the 1.1550 level.
(This story was updated at 10:11 GMT on Dec. 16 to reflect a last-minute unanimous change in non-farm payrolls for November by 50K.)
Employment FAQs
Labor market conditions are a key element in assessing the health of an economy and thus a major driver of currency valuation. Higher employment, or lower unemployment, has a positive impact on consumer spending and thus economic growth, increasing the value of the local currency. Furthermore, a very tight labor market – a situation in which there is a shortage of workers to fill vacant positions – can also impact inflation levels and thus monetary policy because low labor supply and high demand lead to higher wages.
The speed at which wages are rising in an economy is important to policymakers. Higher wage growth means households have more money to spend, which typically increases prices of consumer goods. Unlike more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persistent inflation because wage growth is unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The importance that each central bank attaches to labor market conditions depends on its objectives. Some central banks have mandates related to the labor market in addition to explicitly controlling inflation levels. For example, the US Federal Reserve (Fed) has a dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole responsibility is to keep inflation under control. Nevertheless, and regardless of the mandate they have, labor market conditions remain an important factor for policymakers, who view its importance as a measure of the health of the economy and their direct relationship to inflation.
