What are Non-Farm Payrolls or NFP?

The non-farm payrolls, or 'NFPs,' in the United States are an official statistic provided by the US Department of Labor on the first Friday of each month.

Non-farm payrolls are used to calculate the number of individuals employed in the United States and are released concurrently with the unemployment rate. Both are major indicators used by traders and analysts to assess the state of the US economy. Non-farm payrolls, in particular, count the number of persons employed in all enterprises in the United States, excluding agriculture, local government, private households, and not-for-profit organizations.

Nonfarm payrolls data excludes some government workers, private homes, entrepreneurs, and non-profit employees, in addition to farm workers.

THE COVID-19 GLOBAL PANDEMIC HAD A MAJOR EFFECT ON US NONFARM PAYROLLS IN MARCH 2020.

After more than a decade of expansion, nonfarm payrolls in the United States shrank by 701,000, bringing the unemployment rate to 4.4 percent.

Consistently falling non-farm payroll figures, for example, could indicate weakness and the risk of a possible recession, whereas consistently robust data on a month-to-month basis could indicate a strengthening economy, possibly even indicating that the economy is no longer in danger of entering a recession.

Analysts make predictions ahead of the release of the non-farm payrolls report, indicating a likely figure. When payroll statistics come in above forecasts or miss estimates on release, it may surprise the markets and have a favorable or negative influence on the US currency and major indices like the Dow Jones Industrial Average. For example, a stronger-than-expected NFP report might boost the US dollar's value against other currencies, but weaker-than-expected statistics could put downward pressure on the dollar's value versus a basket of other currencies like the euro, pound, or yen. As a result, trading non-farm payrolls can be a valuable component of your spread betting or CFD trading strategy.

When are non-farm payrolls released?

Non-farm payrolls are normally reported on the first Friday of each month at 8:30 pm (Philippine time) and provide insight into month-over-month and year-over-year data. Month-over-month compares last month's statistic to the previous month, while year-over-year compares last month's figure to the same month a year ago.

You can trade the US dollar and US indexes based on whether you believe non-farm payrolls will come in above or below forecasts as a trader.