NFP: We forecast an increase by 170K - Nomura

According to analysts from Nomura, the US employment report (to be released on Friday) will show a similar patter as the September report;  they see an increase of 170K in NFP. 

Key Quotes: 

“The September employment report indicates that the US labor markets continued to tread water. Job growth steadied with nonfarm payrolls increasing by 156k, but slack remained as the unemployment rate edged to 5.0% from 4.9% while the underemployment rate (the “U-6” measure) was unchanged at 9.7%. Incoming data suggest a similar story for October.”

“Employment indicators have been mixed but tilted to the upside and initial jobless claims remain at low levels. All things considered, we expect private payrolls to have expanded by 170k in October. We forecast that government payrolls have remained unchanged in October, implying that nonfarm payrolls increased by 170k.”

“Last, as the labor market continues to tighten, we think that wages likely picked up over the month. Plus, a favorable calendar quirk (fewer working days during the BLS survey reference period) should help boost the per hour wage. Taking these factors into account, we forecast that average hourly earnings have grown by 0.3% m-o-m (2.5% y-o-y) in October.”