May Non-Farm Payroll Preview

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Scheduled to be released tomorrow at 8:30am EST will be the May Non-Farm Payroll number which consensus is currently projecting to be in the 160,000 area. Below are the projections from some well known institutions from highest to lowest:

Lloyds 195K                                                              

JPM 182K 

GS 165K 

BofA 160K 

UBS 160K 

BarCap 150K 

Citi 140K 

MS 140K 

Wells 135K 

Deutsche 135K 

BNP 110K

April's NFP was a print of 160K, a miss from the 180K consensus area. It's worth noting that only once in the last two years (24 months) has a NFP release missed projections in consecutive months.  Interestingly, the time it did occur was in August and September of 2015, just months before the Fed approved its December rate hike.

Earlier today, Dallas Fed President Robert Kaplan suggested that a print of 100-150K is the "break even" mark, presumably the line where the unemployment percent maintains or declines.

In essence, even with the bar lower for tomorrow's number, a print near to expectations should be ample for the Fed to continue to beat the drum's of a rate hike, which should show accordingly, in the Fed Fund Rate Futures.

One final stat to consider is that today's SPX close was at a three month high. Each of the last 15 times the SPX closed the day before the NFP at said high, the NFP release day closed higher for the benchmark index.


Michael Blythe
HFT Futures Strategist
Hamzei Analytics, LLC