March 10th, 2017
What is the NFP?
NFP is an acronym for Non Farm Payroll Report, a commonly anticipated U.S. government report released on the first Friday of every month. NFP data is collected, analyzed & released by the United States Labor Department, providing a financial and economic summary from various standpoints of leading American companies and manufacturers. The NFP report is frequently anticipated by economists, market analysts, & traders worldwide, due in part to its track-record of generating change and volatility in financial markets on the days prior to, following, and most significantly, on the day of its release.
The report’s results are generated based on data collected via household, institution and corporate payroll surveys, with corporate payroll surveys designed in direct correlation to the US Labor Department’s interviews of U.S. businesses and manufacturers. In turn, the public is exposed to factual, economic and employment statistics about some of the biggest names in corporate America, with survey questions developed based on the feedback of U.S. corporate spearheads. Should business owners and leading executives forecast positive economic developments for their company, recruitment numbers escalate, generating higher survey figures and results, and the reverse for negative projections.
Why Follow the NFP Report Results Monthly?
Often vital and useful to Forex traders globally, past NFP Report release dates have proven to generate high levels of market volatility, along with the evident impact on long-term currency trends, and U.S. index and commodity rates on the day results are announced.
Simultaneous to the announcement of NFP Report results, the U.S. unemployment rates, average hourly pay rate and the industrial manufacturing stats are released to either support or negate the US Labor Department’s conclusions. Traders can thus evaluate their execution approach and make strategic decisions in considering the various statistical factors and data available to them. Whether it be in determining and planning the timing of buying and selling an instrument, opening and/or closing trades, or selecting an instrument to pursue based on economic conditions, the NFP Report results are used by many as a tool to optimize trading results.
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