Non-farm payrolls, and what actually moves the dollar
Payrolls is the loudest release of the month: the first Friday, half past eight in New York, with both London and New York at their desks. What it is not is one number. It is four, they can disagree with each other, and which of them the market cares about depends on what the Federal Reserve has said it is watching.
High-impact releases are flagged on the currency and on every setup that includes it.
Four numbers, one release
They arrive in the same second and they do not always tell the same story. Reading them in the right order is most of the work.
The headline
Jobs added or lost outside farming in the previous month.
The number everyone quotes and the one most often over-read. A single month is noisy, and a big beat that comes with a weak wage figure rarely holds its move past the first hour.
Average hourly earnings
What those jobs pay, month on month and year on year.
The part that speaks to inflation. When a central bank is worried about prices rather than jobs, this line can turn a strong headline into a dollar-negative report.
The unemployment rate
From a separate survey of households, not of employers.
It can disagree with the headline, because the two come from different surveys. When it does, the market usually trusts the rate for the trend and the headline for the noise.
The revisions
Changes to the two months already published.
The most underrated line in the release. A big beat that comes with heavy downward revisions is not the strong report it looks like, and the market works that out in minute two, not minute one.
Good is not the same as better than expected
The market has already paid for the forecast. A healthy figure that lands where everyone thought it would changes nothing, and a mediocre one that beats a gloomy forecast can lift the dollar all afternoon. The move comes from the gap between the number and the expectation, not from the number.
On top of that sits what the central bank is steering on. The same wage figure is the whole story when the worry is inflation and a footnote when the worry is unemployment, and the bank tells you which it is at every meeting.
That is why two payroll reports with nearly identical numbers can produce opposite moves. Nothing about the data changed. The question being asked of it did.
If you trade a funded account
Payrolls is exactly the kind of release prop firms write rules about, and those rules differ more than people expect. Some allow it outright, some take back the profit of a trade opened in the window around it, and some can close an account for it.
None of them refunds a loss made in that window, which is the asymmetry worth remembering before the number lands.
The rule for each firm, taken from their own terms, is on the prop firm pages.
What we do with it, and what we do not
We do not publish a payrolls strategy. The most unpredictable minute of the month is a poor place for a fixed recipe, and anyone selling one is making money from the recipe rather than from the trade.
What we do is the hour either side. Before it: the release is flagged on the dollar and on every setup that has the dollar in it, so nothing in the list surprises you. After it: the outcome is read from the primary source, weighed against what the Fed says it is watching, and if it changes the assessment the scores are rerun and the reason is written in the log. If it changes nothing, that is written down too.
How a release is read against expectations is set out in the learn article, and everything scheduled for this week is on the calendar.
Questions about payrolls
What is the non-farm payrolls report?
The monthly count of jobs added or lost in the United States outside farming, published with the unemployment rate and average hourly earnings. It comes out on the first Friday of most months at 08:30 New York time and it is the single most watched release in the currency market.
Why does NFP move the dollar so much?
Because it speaks to half of the Federal Reserve's mandate and it arrives before anything else that month. It is the first hard read on whether the economy is cooling, and it is released when both London and New York are at their desks, so the reaction has the volume behind it to carry.
Which part of the report matters most?
Whichever part the Fed has said it is watching. When the worry is inflation, average hourly earnings can override a strong headline; when the worry is the labour market, the unemployment rate does. The revisions to the previous two months matter as well, and they are the part most traders miss in the first minute. Reading a release
What is the best NFP trading strategy?
We do not publish one, and anyone selling you a fixed recipe for the most unpredictable minute of the month is selling the recipe rather than trading it. What we do is the part before and after: what the figure has to show to change the dollar's standing, and whether our assessment changes once it lands.
Can I trade the news on a funded account?
It depends on the firm, and the rules differ more than people expect. Some allow it, some deduct the profit of a trade taken in the window around a listed release, and some can close the account. Our prop firm pages have the rule for each firm, taken from their own terms. News rules per firm