Chances are you’ve already heard that we’ll see the non-farm payroll data for August tomorrow. Market participants are anxiously awaiting the data as it is the most important release between now and the FOMC meeting that takes place 9/21 & 9/22. Fed Chair Powell continues to insist upon seeing better employment figures before he’d consider tapering. Tomorrow’s figures will help traders determine whether or not the Fed is likely to announce tapering later this month or if they’ll hold off until the November meeting. Today’s jobless claims data was encouraging, coming in at the low end of expecations (340K). That figure is the lowest since the pandemic began about a year and a half ago.
Estimates are calling for about 740k jobs added tomorrow and an unemployment rate of 5.2%. While the headline figure would be down from July (943k), that would be another solid reading. Many market participants seem to be hoping for a more tepid reading in hopes it will force Powell to hold off until the November meeting. With uncertainties still abound concerning the delta variant and unemployment benefits ending in a matter of days, I think that crowd may get their way regardless. A blowout number (amongst other factors) may force his hand, but I wouldn’t be surprised to hear him cite these issues as reasons to hold off until November either.