At 20:30 Peking time, the usa will release the October non-farm payroll report. The market expects that severe hurricanes and major labor strikes may lead to a significant decrease in new employment in October, making it the slowest month of employment growth in nearly four years, but the unemployment rate will remain stable.

According to a survey of economists by foreign media, the number of non-farm jobs in October may have increased by 0.113 million, while the increase in September was 0.254 million. Wall Street banks have a wide range of expectations for this data, ranging from a decrease of 0.01 million to an increase of 0.18 million, while the unemployment rate is expected to remain unchanged at 4.1%.

Michael Arone, Chief Investment Strategist at State Street Global Advisors, said, 'The unemployment rate will remain low, I believe wage growth will outpace inflation, both of which will underscore the health of the US economy.'

In terms of wages, it is expected that average hourly wages will increase by 0.3% month-on-month, 4% year-on-year, consistent with September, further indicating that inflation remains sticky but not accelerating.

These figures will make it more complicated for Fed officials to determine the outlook for the labor market at the policy meeting on November 6-7. However, following a 50 basis point cut in September, the market expects the Fed to still cut rates by 25 basis points at the November meeting.

Regardless of the outcome, the market may choose to disregard this report, as many one-time shocks have suppressed hiring. Skanda Amarnath, Executive Director of the American Employment Association, said in an explanation of outlook data released on October 30, 'Fed officials are more likely to 'ignore' the negative impact of hurricanes and only react in the case of strong wage growth.'

Arone added, 'The overall numbers might be a bit noisy, but I believe there will be enough evidence to continue to prove that a soft landing is still underway, and the US economy remains in good shape.'

Could non-farm data be 'distorted' tonight?

Leading indicators show that recruitment is still ongoing with a low layoff rate, despite losses from storms and strikes, ahead of the closely watched employment report release.

This week, ADP, a payroll processing company, reported that private companies hired 0.233 million new employees in October, far above expectations, while initial jobless claims dropped to 0.216 million last week, remaining at the lowest level since late April.

Nevertheless, the White House estimates that these events could lead to a reduction of up to 0.1 million jobs. Chairman of the Council of Economic Advisers, Bernstein, said on Wednesday, 'These disruptions will make interpreting this month's employment report more challenging than usual.'

An increase of 0.113 million in non-farm employment would mark the weakest month in recruiting in nearly four years, although many forecasters have already taken into account the temporary impact of Hurricane Helen and the weeks-long strike at Boeing.

In October, hurricane losses in the US may hit a record high, while the Boeing strike has caused 0.033 million workers to stop working. The Bureau of Labor Statistics estimates that during the week the companies were surveyed, 0.044 million workers participated in major strikes, compared to only 2600 in September.

Goldman Sachs estimates that Hurricane Helen has reduced 0.05 million jobs, but Hurricane Milton occurred too late to impact October's data. Goldman Sachs added that simultaneously, the Boeing strike may result in a total decrease of 0.041 million, with a projected total employment increase of only 0.095 million.

Bank of America economist, Shruti Mishra, stated in a briefing on October 30th that hurricanes 'may have had a negative impact on job growth across industries, especially in the leisure and hospitality sector.' The economist mentioned that overall, storms and strikes may reduce last month's job growth by at least 0.05 million, while pre-election temporary recruitment before the November 5th presidential election may increase government employment by 0.025 million.

Analysts may focus more on the unemployment rate, which is considered to be less affected by storms and strikes. The labor force participation rate, calculated from the same household survey as the unemployment rate, is expected to remain at 62.7% in line with September.

The unemployment rate rose from a low of 3.4% last year to 4.3% in July, then gradually declined over the following two months. Economists generally believe that a large influx of foreign population at the southern border is one of the reasons for the rise in the unemployment rate, but the number of border crossings has decreased in the past few months.

Goldman Sachs economists Ronnie Walker and Jessica Rindels said in a report released on October 31st, 'Labor force growth is slowing, partly reflecting a slowdown in immigrant contributions, which should gradually help newcomers to the labor market find jobs, thus exerting downward pressure on the unemployment rate for this group.'

In addition, many analysts believe that hurricanes could lead to a temporary increase in hourly wages due to reduced working hours. Following strong wage growth in August and September, economists still expect wage growth to slow in October. Market expectations are for average hourly wage growth to slow to 0.3% monthly, keeping the 12-month growth rate at 4%.

Citi economists Veronica Clark and Andrew Hollenhorst said in a briefing on October 28th in a prospectus report, 'If wage growth continues to be robust, this could be a worrying sign of inflation pressure, but ultimately, we believe that a soft labor market is exerting downward pressure on wages.'

Fed rate cuts path unlikely to change.

Given the anticipated distortions, some economists believe that Friday's non-farm payrolls report will not have a significant impact on Fed officials' view of the health of the labor market.

Jefferies Financial USA economist Thomas Simons said, 'One thing Powell has always been quite insistent on is that we should rely on data, but not just on one or two data points, so if we do get a weak employment data, or an increase in the unemployment rate, I think they'll see that.'

Overall, recent data other than the non-farm payrolls report shows that the labor market is gradually cooling down. Data released by the Bureau of Labor Statistics on Tuesday showed that job vacancies in September fell to the lowest level since January 2021. At the same time, the resignation rate, as a sign of worker confidence, decreased from the revised 2% in August to 1.9% in September.

Senior economist Sarah House of Wells Fargo & Co. wrote in a research report, "We believe that policymakers are concerned about the broader trend of the job market cooling significantly over the past year, although it is not soft in absolute terms, but in many ways, it is softer than before the pandemic."

Is the upward trend of gold hard to end?

Gold faced strong selling pressure during the U.S. session on Thursday, quickly dropping from historical highs to around 2731 before rebounding slightly. Analysts at ANZ Bank stated in a research report that the price of gold declined as investors took profits after a strong rally in the past month. The analysts added that strong overall economic data in the USA support a more cautious attitude towards the Fed's future interest rate cuts in the coming months. Investors will focus on the U.S. October employment report and PMI data released today to further determine the Fed's next steps.

FXStreet analysts pointed out that from a technical perspective, overnight gold gave back most of its weekly gains, with the daily chart showing a corrective decline that may continue, but it is still far from a bearish level. After last night's rapid fall, technical indicators moved out of the overbought zone, trending downwards above the neutral zone. However, the gold price still remains above various moving averages, maintaining a bullish trend. The 20-day SMA is currently near 2696.00, providing dynamic support for gold.

However, on the 4-hour timeframe, the downside risk for gold is evident as the price has fallen below the 20-day SMA, losing its short-term bullish momentum near 2766.00. Only the 100-day and 200-day SMAs are steadily rising and far from the current price. Technical indicators show that it has dropped below the neutral zone and is maintaining a sharp downward pattern.

Analyst Edward Meir of Marex stated, "Investors still maintain a buy-on-dips mentality, which will continue during the U.S. election period and perhaps also after the election because there will be a lot of turmoil. With no signs of recession and declining inflation, the economy looks positive... The key now is how fast the Fed will cut interest rates."