NFP likely slowed in December – TDS
Fundamental Forex Analysis

8 Major Banks expectations from December payrolls report

Today, the US jobs report for December is due to be reported at 1230 GMT, and as we get closer to the release time, here are the expectations as forecasted by the economists and researchers of 8 major banks, regarding the upcoming employment data.

Most of the economists and researchers are expecting US NFP to post a soft reading in between 145-175k in December, following the exaggerated surge in November of 266K. In addition, they are forecasting the unemployment rate to remain steady at 3.5% for the month.

TD Securities

“We see more downside than upside risk for payrolls in December after an exaggerated surge in November (266K and around 220K excluding returning strikers). Even our below-consensus 145K forecast implies a strong 189K average for Q4, above the 173K average for the first nine months of the year, so the December reading could be even weaker without necessarily signaling a major slowing in the trend. A still-solid trend continues to be signaled by jobless claims.”

“We are neutral relative to consensus on the unemployment rate and hourly earnings: flat at 3.5% and up 0.3% m/m, respectively. The unemployment rate and the rest of the household survey data will reflect the annual re-estimation of the seasonal factors; changes are typically minor and offsetting. The annual revision to the establishment survey data, which can lead to sizable changes in payrolls, will be in the January report released in February.”

Danske Bank

“We will look towards a 175K headline print. Also, we expect unchanged yearly wage growth of 3.1% with risks skewed towards a slight drop to 3.0%. While this overall is slightly stronger than consensus expectations we would expect but a modest positive market impact if this proves right.”

“The key thing for markets is that the report shows a continued tightening of the labour market, i.e. that job growth stays above roughly 100,000. A very weak print, which in our view is not in the cards, would on the other hand trigger a risk off move.”


“After a remarkably strong November labour report, we expect to see a more muted yet still respectable set of jobs numbers for December.”

“Consequently we see some scope for a mild data disappointment with payrolls predicted to rise 150,000 versus the 160,000 consensus. The range of analysts polled by Bloomberg is 125,000-210,000.”

“If we continue to see more of these economically disenfranchised people returning to the jobs market the upside for wage growth may continue to be rather limited. We look for wage growth of 0.2% month on month, 3.0% YoY.”

Deutsche Bank

“On payrolls, the consensus is +167k, with the unemployment rate expected to remain at 3.5%, its joint lowest since 1969. This follows some fairly strong US employment data recently, with nonfarm payrolls growing by +266k in November, the most since January, while the 3-month moving average also rose above +200k for the first time since January. The full day by day week ahead is at the end.”

National Bank Financial

“We’re calling for a deceleration in employment creation to 150K, a level still comfortably above what the Atlanta Fed considers sufficient to absorb new entrants to the labour market and keep the unemployment rate steady over the long term (+110K/month).”

Wells Fargo

“We expect Nonfarm payrolls to rise by 160,000 in December, following November’s blowout 266,000-job gain.”

“The employment report is full of interesting details that provide insight into many areas of the economy. The manufacturing data have been more volatile of late due to the earlier strike at GM and return of striking workers in the November data. Amidst this noise, the diffusion index, which measures the share of manufacturing industries adding jobs, has been gradually improving, hinting that the manufacturing slowdown may be coming to an end. The household data for 2019 will also be revised to new population estimate and seasonal factors.”

Standard Chartered

“We expect headline job gains to be on the weak side, but recommend looking through such weakness, as it would likely be due to adverse seasonal effects.”

“Seasonal impact aside, ongoing strength in nonsupervisory wages could bode well for consumer spending in 2020. Similarly, increases in labour participation, despite what we believe are significant structural pressures in this area, would signal ongoing cyclical strength in the US labour market.”

“On the other hand, higher wages would put pressure on corporate earnings, all else equal. Given the conflicting impact that higher wages could have on growth, they would reinforce keeping monetary policy on hold near-term.”


“There is plenty of room for surprise as ever in the US employment report. Non-farm payrolls surged 266k in Nov, the strongest reading since Jan 2019, while the unemployment rate slipped back to 3.5%.”

“The median forecast for NFP is 160k, with the +/- 1 standard deviation range 146k to 185k (Bloomberg survey). The unemployment rate is expected to hold at 3.5%, while average hourly earnings are seen up 0.3%mth, 3.1%yr. The post-GFC peak in wages growth was 3.4%yr in Feb 2019.”

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