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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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The disappointing April employment report has tempered the risks to Goldman Sachs' Fed tapering call - while their core view remains that tapering will begin in early 2022 after FOMC "hints" in 2H 2021, they are see less risk of a more hawkish outcome of a Jun/Jul taper hint + reduction of asset purchases in 4Q 2021.
- This comes partly as a result of Friday's report in itself, but also due to Goldman's "revised expectation that the path of seasonally-adjusted job gains will be smoother and less front-loaded" than they had anticipated.
- Goldman didn't see "any evidence of problems with a spurious evolution of either seasonal factors or the birth-death model contribution" in April's data.
- They see the disappointment stemming from reopening effects overlapping w normal April seasonal hiring patterns, "resulting in less-impressive job gains" on a SA basis, as well as other factors including generous unemp benefits, childcare constraints, and health risks reducing labor supply.
- April job gains "almost certainly understate" the current trend in jobs growth, and given lower seasonal hurdles for virus-sensitive industries in Q3, Goldman now expects stronger SA gains "than a front-loaded reopening boost might intuitively expect" - a +800k avg between May-Sep.
- This will bring the unemp rate down to about 5% in Jul or Aug, just before the Sept FOMC.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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