[Preview] The August US employment statistics are scheduled to be announced tonight. Will it affect the pace of interest rate cuts?

The number of non-farm payroll employees in August is scheduled to be announced.isIt is scheduled to be announced on Friday night (6th) in Japan time.In the market, it is expected that the number of new non-farm payroll employees in the United States in August will recover significantly from 0.114 million in the previous month to 0.165 million people.The growth of the average number of employees in the past three months has slowed down to slightly over 0.15 million people, which is the smallest growth since early 2021.The unemployment rate is expected to decrease slightly from 4.3% to 4.2%.and the unemployment rate is expected to drop slightly from 4.3% to 4.2%.There is a possibility of doing it.

Investors are looking ahead to the August non-farm payroll report.Investors are watching to see if the labor market can demonstrate enough resilience to dispel concerns of an economic downturn.Doing.

Citigroup is more pessimistic than the general expectations.Employment in August is expected to remain at 0.12 million5000, with the unemployment rate forecasted to stay at 4.3% similar to July. The weak numbers in July are not due to temporary factors, but confirm an actual weakening in labor demand, indicating that the Fed Reserve's 50bp rate cut in September is likely to happen.

Bloomberg economist Anna Wong is optimistic about August, saying, "The number of non-farm payrolls may improve from the disappointing figure in July, but the early forecast for the March 2024 reference period by the U.S. Bureau of Labor Statistics has been revised downward by 0.818 million people, which may have made Federal Reserve officials reluctant to believe the initial value."

Will the non-farm payroll numbers for August continue to be weak?
CitiIt is expected that new employment will remain weak, as it was in July.be predicted to be as weak as in July.

There is downside risk to employment in the construction industry, government sector, manufacturing, and leisure and hospitality. The total amount of residential construction has been decreasing throughout the year, which goes against the trend of increasing employment in the construction industry. Non-residential construction spending has also been stagnant in recent months, and the direct spending stimulus from fiscal policies in the past few years has reached its peak. Therefore, it is expected that employment in the government sector will continue to decline in the next few months.

In addition, it is expected that employment in the automobile manufacturing industry will decrease significantly by 0.01 million 5000 people due to the reflection that employment in the manufacturing industry typically decreases during the summer vacation period in July and may not fully recover even in August. There is a high possibility that the production level will decrease due to the sluggish demand for automobiles.

Finally, spending on discretionary services such as restaurants has been sluggish for most of this year, leading to further decline in leisure and hospitality employment.

In addition,There is a risk that the unemployment rate could lead to the dovish policies of the FRB.There is.

Even if the unemployment rate rises above 4.4% again and the number of new employees increases significantly, it is highly likely that the FRB will lower interest rates by 50 basis points.

The unemployment rate has been rising every month since March, which is typically a precursor to an economic downturn. The unemployment rate in August is expected to remain at 4.3% and may even decrease to 4.2%, but the risk of the unemployment rate rising further is still underestimated as the labor market rapidly weakens.

Even if the unemployment rate has slightly decreased, it may be insufficient to convince the FRB officials with only one month of data. However, if the unemployment rate returns to 4.2% or 4.1%, new job creation may become even more important. If the number of employees in August falls below 0.125 million, there is a high possibility of rushing for a rate cut.

U.S. job openings hit a 3.5-year low.
U.S. Department of LaborThe Job Openings and Labor Turnover Survey (JOLTS) for July released on the 4th showed a decrease of 230,000 job openings to 7.67 million, which is the lowest in 3.5 years.The deviation from the closing price of 2,371 yen on the 9th is about Lowest level in 3.5 yearsHowever, the slowdown in the labor market is orderly and not severe enough for the Federal Reserve to consider a 0.5% point rate cut at this month's meeting.