Non-farm payroll (NFP) is a key indicator of the US economy. It measures the increase in the number of workers in various sectors including the government, private sector, households and non-governmental organizations, excluding the plantation sector.

This data is released every first Friday of the month by the US Department of Labor Statistics. These reports often cause large movements in the financial market, especially involving the USD currency as soon as the readings are released. Therefore, this data is the focus of all market participants at the beginning of the month. The employment data report includes three important components which are employment growth, average earnings and the unemployment rate.

In addition to monitoring the rate of earned income, it is very important to ensure that the unemployment rate is under control to determine the current economic stability. The question is, what does NFP have to do with forex trading? The increase in employment recorded in the data is important because the labor force affects the stock market, the value of the dollar and the price of gold. If many residents are employed, it means that the country’s economy is in good condition and vice versa.

In addition, the data also focuses on salary rates. The wage rate for about 80% of workers affects the entire gross domestic product (GDP).