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It’s interesting to see that Wall Street moved firmly higher after the latest US Jobs data was released. That could have been a temporary boost but the CFDs futures markets also saw a similarly firm move. The clear catalyst was that fact that the private sector added more jobs than forecast. Nevertheless equity market gains were limited following a dip in the ISM Non-Manufacturing Index.

Looking in a little more detail, the US labour force lost 54,000 jobs in August, which was less than the 105,000 job losses economists were expecting. A major contributor to the decline was the winding down of 114,000 temporary workers hired for the US census.

According to IG Index, “Of more importance was the fact that the private sector added 67,000 new workers, which was ahead of the 40,000 expected by economists. Interestingly, the previous month’s employment figures were substantially revised upward. In July there were actually 54,000 jobs lost, not the 131,000 originally reported, while the private sector added 107,000 jobs in July instead of the 71,000 reported.

“This US payroll data is encouraging as it points to a pick-up in private sector hiring which will hopefully continue to build in the future. However the fact remains that the US economy still has a long way to go if it is going to tackle its high unemployment rate, which is currently hovering around 9.6%”.

Nonetheless, the payroll data should ease concerns that the US economy will slip back into recession, and also take some pressure off the Federal Reserve from having to implement further monetary easing. That is certainly worth noting if you are forex spread trading and concerned about a weaker US Dollar.

Taking some of the shine off the employment data was a drop in the ISM non-manufacturing index. The report suggested a slowdown in growth and that served as a reminder that conditions in the US remain challenging.