Monday, November 6

Surprise in non-farm payroll figures

Last week the traders have been focusing on the release of one economic data: the change in non-farm payrolls.

Reason: people have been worrying about the exceptionally low increase in non-farm payroll in September (at 51K) and whether the trend will continue. If so, this is a strong signal of recession.

Result: The October data shows a 92K increase in payrolls, lower than the expected 123K but much higher than the Sep data. More importantly, the 51K number is now revised upward to 148K (!) so the earlier worry about the exceptionally low figure is unwarranted.

You know, sometimes I wonder if we should pay this much attention to economic data if the revised figure can be so much different from the original. It is better to focus on longer-term trend than short term fluctuations based on this rather misleading data points.


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