NFP explained: how to readthe US jobs report.
NFP, the US non-farm payrolls report, comes out on the first Friday of most months and is 1 of the biggest events for the dollar. NFP explained simply: it tells you how many jobs the US economy added.
But the headline is only 1 of 4 numbers the market reads.
The 4 numbers
Jobs added, the unemployment rate, wage growth and the revisions to earlier months. Wages feed into inflation, revisions can change the whole story.
How the market reads it
A strong headline with soft wages and negative revisions is not a strong report. The first spike often reverses once traders read all 4.
Use it in real trading
The tool informs the decision, it never makes it. Here is how it plays out on real trading days.
Jobs, wages and revisions all beat. The dollar rallies and holds.
Strong headline, soft wages. The dollar spikes and fades. You waited, so you did not chase it.
Mistakes to avoid
- Trading the headline in the first second.
- Ignoring revisions.
- Forgetting wages.
What makes it different
The Scenario Desk prepares NFP outcomes, and the headlines show how the market actually read the report.
Questions
When is NFP released?
Usually the first Friday of the month at 13:30 London.
Why does the dollar reverse after NFP?
Often because wages or revisions tell a different story.
Should I trade NFP?
Only with a plan and smaller size.