How do the non-farm payrolls affect your portfolio?

The United States Non-Farm Employment change or the non-farm payrolls is the change in the number of people employed during the previous month, not including the farming industry.

When the actual change is greater than the previous figure, this indicates that the US economy is growing.

It is expected that 175,000 jobs were added in June. If the figure is more than the official forecast, the dollar should increase. However, if the figure comes in under expectations the dollar could dip lower.

Last month, expectations were surpassed with an additional 211,000 jobs added by US employers.

The major component of the NFP is the number of additional jobs added to the US economy from the previous month. The report also includes insights into wage growth and how individual sectors are preforming.

The data is released on the first Friday of every month, following the date. Also known as the employment change, the data is a vital tool used analyse the health of the US economy.

How Does It Affect Traders?

Unmatched by any other monthly data, the Non-farm-payrolls are eagerly awaited by all.

Employment data is paramount to traders because it is an indication of consumer spending, which accounts for the bulk of overall economic stimulus.

Markets will react to the difference between the actual figure and the forecasted figure.