US NFP: Looking for a 160K gain - Wells Fargo

Analysts from Wells Fargo said that on balance the labor market continues to tighten and they look for a gain of 160K in NFP on Friday, which would be supportive of a December Fed rate hike. 

Key Quotes: 

“Nonfarm payrolls rose a steady 151,000 in August. Private services were once again the bedrock of job growth while employment in the goods-producing sector fell 24,000. The unemployment rate held steady at 4.9 percent for the third month in a row. On the wage front, average hourly earnings continue to show signs of a gradual upward trend. Given sluggish productivity growth and relatively low inflation, however, the acceleration in wages is likely to remain modest relative to previous expansions.”

“On balance, the labor market continues to tighten. We estimate that even with some cyclical rebound in prime participation rates, as we saw again in August, payroll gains above 100,000 should be enough to reduce slack in the labor market. As a result, continued employment growth at or above this pace should be enough to warrant a rate hike by the Fed at its December meeting. We look for a gain of 160,000 jobs in September.”