LIVE MARKETS-Clock is ticking down to US non-farm payrolls

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CLOCK TICKS DOWN TO US NON-FARM PAYROLLS

U.S. non farm payrolls slipped your mind? With other more gripping drama unfolding, it can be forgiven.

But market watchers will have to tear their eyes away in a few hours; the print remains vital for a steer on the outlook for Fed policy.

A wide range of forecasts for May reflects the foggy economy outlook. According to LSEG data, expectations for the increase in non-farm payrolls ranges from 75k-190k.

A Reuters poll puts consensus expectations at 130k which would be a marked decrease from April's 177k. The unemployment rate is expected to stay at 4.2%.

BofA expects labour market resilience, with an above consensus 150k increase.

"This should keep the Fed on hold for an extended period, against a more constructive rates view that the market focusing more on 'stag' than 'flation' seems to have."

UBS' chief economist Paul Donovan notes though that most forecasts are ringing in below consensus.

"Firms may have slowed hiring as trade policy uncertainty has increased, but there is unlikely to be an increase in firing. That does mean that rate cuts would have a limited impact right now (although if consumer demand weakens, rate cuts become more important)," he said.

Citi sees an increase of 120k, while BNP Paribas comes in with 125k.

"We could see a number closer to 50k than 150k, however," warns Neil Wilson, UK investor strategist at Saxo Markets.

Indeed, the ADP National Employment Report released on Wednesday came in well below expectations with a meager 37k private payrolls added. Consensus had been for a 110k rise.

Markets are fully backing no change from the Fed at its June meeting in a few weeks.

But a weak non-farm payrolls print today may bolster bets for a cut.

(Lucy Raitano)

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