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« Junior Gold and Silver Mining Funds or Individual Gold and Silver Mining Stocks | Main | Silver Price Forecast: Silver Prices Will Move Much Higher And Faster Than Most People Think »

What To Expect From Tomorrow's Jobs Report And One Troubling Chart

Remember all those hyperbolic warnings over the years that "this is the most important jobs report" ever? Well, the one due out tomorrow may not be that, but it certainly is one of the most important ones in the past year, and one that will certainly have an impact if not on the Fed's future actions then certainly on the market's (once again erroneous) expectations of what Yellen may do, especially if it is a +/- 60,000 outlier from the consensus estimate of 180,000.

Recall last month's "shocking" jobs print, when only 35,000 new jobs were created, the lowest number since September 2010?

Well, that one print was sufficient to convince the market there would be no more rate hikes in 2016 and most of 2017. A few weeks later, first the capitulatory June Yellen press conference and shortly after the just as "shocking" Brexit, effectively killed the rate hike cycle, with the market now pricing in one full rate hike (that is 0.25bps) all the way in 2018. As LIesman raged, "The Fed Is As Close To Capitulation As I've Ever Seen Them."

But maybe there is some hope still. If so, it will be revealed in tomorrow's payrolls report. As Bloombergsays, "the June jobs report will take on even more importance than usual. Economists and policy makers will use it to determine whether the strongest part of the economy slowed sharply even before concerns over global growth intensified, or if the labor market was merely hit by a temporary soft patch." Ignoring that jobs are among the most lagging economic indicators known, the general (confused) consensus about what payrolls indicate suggests an outsized market response may be forthcoming.

read more.....

A low NFP number would put a nail in the coffin for further rate hikes and send gold higher....although there is a correction on the cards.

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