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UPDATE: USD Change in Nonfarm Payrolls (AUG) > +114K versus +115K expected, from +142K (revised from +96K) > USD Unemployment Rate (SEP) > 7.8% versus 8.2% expected, prior 8.1% > USDJPY BULLISH

Jobs growth in the United States appears to be on the mend again, though you wouldn’t be able to tell just by looking on the surface alone. Nonfarm Payrolls grew by +114K in September, slightly below the +115K consensus forecast, according to a Bloomberg News survey. The August figure, which initially disappointed, was revised higher to +142K – that’s an incredible +47.9% revision!

But the big news is that the US Unemployment Rate dropped to 7.8% from 8.1%, well-below the 8.2% expected print. Moreover, this doesn’t look like a drop in the participation rate is the culprit for the lower jobless rate – this appears to be a legitimate drop in the jobless rate. In fact, the labor force increased by +418K while the Household Employment Change subcomponent registered +873K.

USDJPY 1-minute Chart: October 5, 2012

USDJPY_Up_as_September_NFPs_Impress_Unemployment_Rate_Down_to_78_body_Picture_1.png, USDJPY Up as September NFPs Impress, Unemployment Rate Down to 7.8%

Charts Created using Marketscope – Prepared by Christopher Vecchio

SPX 500 1-minute Chart: October 4, 2012

USDJPY_Up_as_September_NFPs_Impress_Unemployment_Rate_Down_to_78_body_Picture_2.png, USDJPY Up as September NFPs Impress, Unemployment Rate Down to 7.8%

Charts Created using Marketscope – Prepared by Christopher Vecchio

Following the report, risk appetite was rather firm, although the US Dollar did see its fundamentals strengthen slightly. The big mover was the USDJPY, reflecting said sentiment: the USDJPY surged from 78.51 to as high as 78.87, before falling back to 78.77 at the time this report was written. The AUDUSD, EURUSD, and NZDUSD all moved higher as well, while the USDCAD (aided by a strong Canadian labor market print) tanked. Meanwhile, the S&P 500 rocketed from 1462.50 ahead of the release to as high as 1469.50.

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

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