Today, the US jobs report for October due out at 13:30 CET will be in focus. We continue to receive mixed signals about the labour market. Claims figures continue to signal job growth well above 200,000, while the Markit PMI employment index for October points to growth just above 100,000. We estimate jobs growth was 170,000 in October. The unemployment rate rose to 5.0% in September due to an increasing participation rate. That the unemployment and underemployment rates have moved sideways in 2016 indicates that there is still slack left in the labour market. We estimate the unemployment rate was unchanged at 5.0% in October, with the probability skewed towards a fall back to 4.9%. We estimate that average hourly earnings increased 0.3% m/m in October, implying an unchanged annual growth rate of 2.6% y/y. Wage growth has moved sideways in 2016, indicating that the underlying inflation pressure is still subdued.
In Europe, the October service and composite PMIs for Italy and Spain and final revisions of the PMIs in eurozone, France and Germany are due out.
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