Jobs Report Out This Friday… What Impact Will it Have on Rates?

On the first Friday of every month the job numbers come out at 8:30am. I always turn on CNBC an hour or so before they come out to get a feel of what the experts think and to see how the numbers might impact rates.  My wife is not a fan of the first Friday of every month because she likes the Today Show and a struggle for the remote takes place. It’s really the only time in the mornings where we fight for the remote (I let her have the remote in the mornings in order to get a few brownie points to watch sports at night instead of the food network or animal channel). In any event, you get it’s an important day for me. Basically the jobs report will determine what happens to rates for the next 30 days. A stronger than expected number will lead to higher rates and a weaker than expected number will lead to lower rates. Obviously, there are other factors at play but the jobs report is the biggest factor.

What do the experts think the number will be? “I think in general the labor market moderated a little bit in February after some really strong months. I think the weather was a little bit of a damper and it’s time for a breather,” said Amherst Pierpont’s chief economist, Stephen Stanley. He expects to see 220,000 nonfarm payrolls and a slightly lower unemployment rate at 5.6 percent. “A lot of this February data is going to have a weather effect. It was bad enough to have some impact. I do think we’ll snap back in March or April,” he said.

So 220,000 is the barometer. What rates will do for the next 30 days has a lot to with how close the numbers are to 220,000. Anything close to that will not cause much of a move. A much higher number, like maybe over 300,000, will likely cause rates to rise. A weaker number than expected, maybe below 140,000, would likely cause rates to fall.

My prediction is the number will be right around 220,000 and we won’t see much of a move. I’m on a little hot streak with my predictions lately. My prediction for UVA basketball at the beginning of the year was an ACC Championship and a 27-3 record (currently UVA is 28-1 and once again ACC Champs). Not a bad prediction. Let’s see if I’m better at interest rate or basketball predictions!

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