Hello,

 

As we enter September, potential interest rate cuts have re-entered the minds of many investors. This month the Federal Reserve will meet to discuss the merits of reducing interest rates, based on several factors. For market commentators and economists, one of the most important debates has been US job numbers, which will be released this Friday for August. As we have already seen this week with Nvidia shares dropping despite higher revenues, the market tends to react based on numbers beating or missing expectations. Below we’ve compiled a brief outline on what the market expects for this week’s job numbers.

 

US Average Hourly earnings which measure the change in the price businesses pay for labour, not including the agricultural sector is forecasted to increase by 0.3% based on polled economists. Lower figures for this number indicate that the Fed is more likely to cut rates.

 

US Non-Farm Payrolls, which measure the change in the number of people employed during the previous month, excluding the farming industry are viewed as one of the primary drivers of consumer spending and are expected to come in at 164K. Lower figures for this number indicate that the Fed is more likely to cut rates.

 

The US Unemployment Rate which measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month, is expected to come in at 4.2%. Higher unemployment figures indicate that the Fed is more likely to cut rates.

 

As always, if you wish to discuss anything in this newsletter in further detail, please do get in touch.