Major Banks expectations from May US NFP data

7 June 2019, GKFX – Today, the US jobs report for May is due out, and as we get closer to the release time, here are the expectations as forecasted by the economists and researchers of 6 major banks, regarding the upcoming employment data.

Most of the economists and researchers are expecting US NFP to dip in May to somewhere in between the 140K-175k range, following a bumper April figure of 263k. In addition, they are forecasting the US unemployment rate to remain steady in between the range of 3.6%-3.7% in May.

Major Banks expectations from May US NFP data


James Smith, Developed Markets Economist at ING, expects US jobs growth to dip in May to 175k following a bumper April figure 263k.

“While we expect jobs growth to slow this time, we think this is likely to be caused more by supply constraints than by weaker demand.”

“While we expect wage growth to remain at 3.2% in May, this is relatively close to cycle-highs and suggests markets may still be underestimating potential core inflationary pressures.”

“The household survey (which is different to the payroll-based measure of employment) does tend to be quite volatile, so we expect some correction this time around and that could drag the unemployment rate back up to 3.7% in the process.”

TD Securities

Analysts at TD Securities suggest that Wednesday’s surprise 27k ADP Employment report was enough of a miss, nearly 160k below consensus to convince them to reduce their forecast for Friday’s nonfarm payroll release to 140k for May, from their earlier estimate of 190k.

“This soft but not concerning print follows an eye-popping 263k print in the previous month. As such, we would view a number in this mid-100k range as an overdue correction to an unsustainable run rate for payroll growth, rather than the leading edge of a sharp slowdown in economic activity — although we recognize markets will take little comfort in the event.”

“All in, the household survey should show the unemployment rate remained steady at 3.6%, while wages are expected to rise 0.2% m/m. The latter should bring the annual print down a tenth to 3.1%. However, if the monthly growth rate were to round up to a “soft” 0.3% advance, that would keep wage growth unchanged at 3.2% y/y.”

National Bank of Canada

“In the US, the most important piece of news will be May’s non-farm payrolls. Jobless claims continued to hover near a 50-year trough in the month, pointing to a very low rate of layoffs. Hiring, on the other hand, may have eased from the prior month’s healthy pace judging from Markit’s flash composite PMI report which showed private sector employment advancing at the weakest pace in just over two years.”

“Accordingly, we’re calling for a deceleration in employment creation, with just a +175K print. The unemployment rate, for its part, may stay put at 3.6% if, as we believe, the household survey shows a modest increase in employment.”


“Nonfarm payrolls surprised to the upside in Apr as 263k jobs were created. The Apr gain left the 3-month average at 169k. Come May, we look for gain in line with this average at 170k. Said outcome would be consistent with employment growth ahead of population growth.”

“Having declined from 3.8% to 3.6% in Apr, we expect the unemployment rate to stabilize in May. The risk is that an uptick in participation results in the unemployment rate edging back up to 3.7%. Having trended higher over a number of years, prime-aged participation has turned down of late. This uptrend is however likely to return in time, given employment’s continuing strength.”

“Available slack continues to limit wage gains. A 0.3% gain is expected in May.”


“The highlight will, of course, be US payrolls, seen up 175K despite the feeble ADP print earlier in the week. If we were to get a weak reading today then market screams for a Fed cut will only accelerate. Yields will tumble, equities will soar (stupidly), and the USD will likely wobble: however, once people realize that the US cold will be pneumonia elsewhere, the USD should not stay down for long. If we get an in-line of strong print then ironically markets might be unhappy, and the USD perky.”

Danske Bank

Today’s highlight will be the US labour market report. The wage growth figures will be in focus as many FOMC members have opened up for a change in the policy rate during the past days.


This article was provided by analysts at GKFX. The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

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