February non-farm payroll preview

Today NFP report is to be published at 13:30 GMT from US.

What is NFP report?

• NFP or non-farm payroll report is the monthly statistics on labor condition in the US released by US department of labor statistics. The report comprises goods, construction and manufacturing sector companies.
• This report influences the financial markets deeply across asset class.

Key highlights -

• Headline number for total hires last month was 151,000. February ADP employment number was better than expected and robust enough at 214,000, however lower than 267,000 in December.
  
  
• Change in private payroll has been 158,000 last month. Today expected 185,000.
  
  
• Total payrolls are expected at 195,000.
  
  
• Most vital component is wage growth, which only recently have started showing some strength. Today it is expected to rise by 0.2% on monthly basis and 2.5% annually.
  
  
• Labor force participation rate is showing no signs of rebound. It was at 62.7%, in last report. It has weakened over the past year. And more so since the crisis.
  
  
• Unemployment rate is expected to remain at 4.9%.
  
  
• Underemployment rate is expected to fall further from current 9.9%

Impact -

• Volatility is sure to be on the card, post release.
  
  
• Any number above 250,000 would be considered as very good and Dollar might gain its lost grounds.

• While number below 150,000 might dent dollar's strength severely, better than expected number may not be a big supporter of Dollar as key remain inflation and wage growth.

Better than expected wage growth would be key for Dollar's strength. Better payroll can however boost sentiment for equities.

 Saying all that there exists a strong possibility that recent weakness in Dollar may continue a bit further.

Dollar index is currently trading at 97.54, down -0.12% for the day so far.