Blog Article: NFP recap: US employees earning more money

Chart 1

Chart 1 illustrates the performance over the last 5 years of the US aggregate payrolls of production and nonsupervisory employees (basically most of the US workforce), and the weekly hourly earnings of those employees.

Market Talk

Friday’s release of US nonfarm payrolls data suggests:

• US wage growth keeps increasing
• Hiring slowed, but 187,000 new jobs created during July is still a solid number
• The US jobs market is robust

Source: Tradingview/Skilling 4/7/2023 7:05 UTC

The underlying economic situation looks pretty close to perfect, since wage growth is above current inflation, unemployment is near all time lows, and interest rates are slightly above the average long term Fed funds rate.

US 100 CFD +39.6% year-to-date

Bottom line: Inflation has been trending lower this year, however, the strong labour market does increase the chances that inflation could pop higher, which could explain why the US Fed could be less motivated to cut the rate but instead hold the rate above the historical long term average.

Happy days for US stock market investors to continue?

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Today’s economic calendar

US consumer credit expected to increase sharply

• Increases in consumer credit suggest positive economic growth and vice versa

Source: TradingView / J. Knobel August 7 2023 6:25 AM UTC

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Trading prospective:

USD/JPY - Uptrend holding

Technical commentary:

USD/JPY current price 142.18 seems to be holding a bullish theme (daily chart) since price is above its multi-month upward sloping trend line (see chart), 18 day moving average turning up (see chart), MACD above its equilibrium, and RSI above 50 suggest uptrend intact. Upside prospects above the 141.5 support could place the 144.2s in sight with the 146.40s as possible extension, downside risk below 141.5 could expose the 136.30s (see chart).

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