USD Rises on Strong NFP Report, Wages Grow at Fastest Pace Since 2009

NFP Analysis and Talking Points

  • US Nonfarm Payrolls rose by 250k in October, beating expectations of 195k expected; Prior month revised Lower
  • US Average Hourly Earnings Reaches Highest Level Since 2009

See our latest Q4 FX forecast to learn what will drive the currency through the quarter.

NFP Report Review

US Bureau of Labor Statistics reported total nonfarm payroll (NFP) employment expanded by a 250k jobs in October, beating expectations of 195k. However, the headline figure for the prior month saw slight downward revision to 118k from 134k, while the 2-month net revision had printed flat. The unemployment rate remained at the lowest level since 1969 at 3.7%, which will continue to the delight of Fed officials given that they see NAIRU at 4.5%.

Wage Growth Tops 3% for First Time Since 2009

The Fed focussed wage data rose in line with expectations, whereby the monthly rate saw a 0.2% increase taken the yearly rate to 3.1%, marking the fastest rise in wage growth since 2009. Overall this marks a relatively strong labour market report and will keep the Fed on its hiking trajectory with December rate hike odds sitting comfortably at 80%.

Market Response

The strong jobs reports saw a firm US Dollar upon release to pare its earlier losses with the DXY hitting highs of 96.41. The move however was relatively minimal judging by historical standards, given that the report does not alter the Fed outlook a great deal, while investors are now bracing themselves for the US Mid-Term elections next week.

DXY Price Chart: 1-minute time frame (Intra-day)

USD Rises on Strong NFP Report, Wages Grow at Fastest Pace Since 2009

Chart by IG

— Written by Justin McQueen, Market Analyst

To contact Justin, email him at

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