NFP Projection Logs (and Other Misc)

Running out of room on the shout section of my profile. Projections + SolScan proof of date/time

06/06/2025
TimmyCast NFP Projection (prev base + adj for ADP, ISM man/nonman employment, JOLT open/hire/sep, Unem claims 4 wk ma, misc): +135k +/- 50k

In line print = $ up as cuts get pushed out

Bad rev could turn print soft

+EV Kalshi vs model t-Dist (df=5) - >100K NO 28% v 16% / >200K YES 15% v 7% / >250K YES 5% v 3%

3ZF17j3bc2xJvM3pM7gW8J3wVm4it41PXUBUFDFo2FyE85r6UmGK5zZQP98ELXDNsgTfFVE8tQfqQFpxSZbE6W8B

Actual: 139k

07/03/2025
TimmyCast NFP Projection: +81k +/- 40k

5hDw5Z1NbZLTgerGNoWjqy6q9FoebMJYEXp7YJy77PBqK2X8fBZhvGCr8x2NDbACH4zprcHr213hUBN2X2DR6UAc

Didn't use hash on sol memo this time. If I'm way off blame ADP, original runs ~70k so re-weighted.

Actual: 147k

08/01/2025
TimmyCast NFP Projection: +168k +/- 50k

Made some tweaks, well off consensus, Kalshi 150k+ @ $0.15 placed

5SjFkukQoF3nJAVaJQCpDdeB8WGAw24b9PmLD4jBKcc1mcUqBiYQBnM8fRPmNUK4hcx5HCbq6HMPcPcVE1YXugRy

Actual: 73k

With additional complaint:
“ The change in total nonfarm payroll employment
for May was revised down by 125,000, from +144,000 to +19,000, and the change for June was revised
down by 133,000, from +147,000 to +14,000. With these revisions, employment in May and June
combined is 258,000 lower than previously reported.”

Impossible to forecast if the previous prints are wildly wrong.

09/04/2025
TimmyCast NFP Projection: +99.2k +/- 50k

Hopefully closer this time, above forecast of 75k

4cQasc1wVUammFCgQrdPn4rWqD8e5Qqp15TeTSChs9hoa2mJaBhpY9xSzD4RWEjDVhkQ5F9WB3ngi5r8rWbQnKqn

Implied v Kalshi
P(NFP > 0k): 94.8% v 98%
P(NFP > 50k): 81.5% v 70%
P(NFP > 100k): 49.4% v 29%
P(NFP > 150k): 17.8% v 6%
P(NFP > 200k): 05.0% v 2%

Trump downplaying numbers worries me, this one could very well come in cold, but the model is the model

Actual: 22k

I should have listened to Trump.

It looks like the BLS may have corrected their overestimates for non-respondents. Relevant here because the model is using the un-revised NFP prints to map vs the ADP components.

Next month I think I will try using the revised figures, otherwise I think I will continue to be way off for 2-3 months.

BLS benchmark revision due out tomorrow, and looks like the market is centering around a -700k revision to the prior year's job numbers. Worth noting that the spread on estimates is very wide though, so we could see some significant difference from this figure.

Last benchmark did not affect equity markets, and this one could likewise be easily seen through as it is widely expected.

Rate cut in Sep is nearly completely priced in, but the implied chance of a 50 bp cut is only ~10%. If the revision is bad enough to move the implied rate, we may see markets respond negatively: 25 bps is a ordinary start to an easing cycle, 50 bps could indicate fear of a hard landing. Equities like cuts, but not if they indicate material deterioration of macro conditions.

Likely no impact, but risk skews to the downside if there is a move.

Position: SPY 646P 9/12/2025 (CPI and PPI also in consideration)

Benchmark revision played out mostly as expected, equity market was able to shrug off revision of -911k.

Holding position heading in to PPI and CPI. I would not expect another 0.9% reading for PPI or Core PPI, but risk skews to the upside of market expectations. The expectation is for trade services to mean revert, but the important question remains: was last month's bump tariff/uncertainty related, or simply noise in a volatile component?

ISM prices paid decreased but remained in cost push territory for both manufacturing and services.

I'm holding off on CPI until we get this print, but looking for PPI of 0.4% for core and 0.3% for headline. This won't be the shock we saw last print, so not expecting a major equity move off that.

FOMC meeting outlook:

1. SEP-
   1. PCE Inflation- remains largely the same, 3.0% neighborhood for 2025. Uptick to 2.5/2.6%ish for 2026, stays at 2.1% for 2027.
   2. Change in real GDP- return to March projection levels, 1.7-1.9% for 2025-2027
   3. Unemployment rate- uptick to 4.6% for 2025, 4.8/4.9% for 2026, 4.4/4.5% for 2027
   4. Dot plot- significant shift down for 2025 with split between 1 and 2 further cuts, with slight edge to 1 further. Slight shift down for 2026 and no significant change for 2027 or longer run.

   
   
   
   
   

2. Statement-
   1. Same old, same old, both risks to both mandates mentioned with slight weighting to labor
   2. Miran is the only dissenter for 50 bps, Waller and Bowman both stay with the consensus 25
   3. No dissenters for hold. If there is maybe Logan or Schmid. Will likely be framed as an insurance cut for more hawkish members, so I expect the FOMC to largely fall in line.

   
   
   
   
   

3. Rate-
   1. 25 bp cut, bet the farm. Labor market slowing but not weakening, 50 bp cut would signal to market fear of a hard landing

   
   
   
   
   

4. Press conference-
   1. Says good afternoon
   2. Powell acknowledges slow down but denies weakening, emphasizes that the Fed is well positioned to support labor market if conditions worsen
   3. Emphasize uncertainty around inflation outlook, and reiterates that the Fed will remain data dependent
   4. Points to unem rate stability as potentially signaling a decrease in labor supply and labor demand, tempering fear that jobs revisions show a real problem
   5. Balks on questions around independence and Cook
   6. Kalshi play- Beige Book gets mentioned as evidence of either labor slowdown or consumer resilience

   
   
   
   
   

If Timmy was on the Fed:
Labor slowdown has more to do with uncertainty and labor specific dynamics than restrictive policy. Start of cutting cycle will ease pressure on equities but will not reflect in the wider economy; cheaper money will not fix any looming issues with the labor market. With this in mind, 25-75 bps will not drastically derail inflation targeting, and tariff inflation is still not showing real signs of materializing. This doesn't mean that it won't, but not here yet so the Fed can no longer wait for it to appear. Retail spending has been resilient but showing greater signs of strain in household debt burden, so some loosening will do good in that respect. Watch the 10 and 30 yr to see how credible Fixed Income views this easing cycle, would not be shocked to see some upward yield pressure in the next couple weeks on the long end of the curve.

Question: How do we reconcile strong GDP growth and resilient retail sales with a weakening jobs market? Waller

Answer: Jobs market is being impacted by uncertainty more than a restrictive monetary environment. NFP prints remain positive, but JOLTS quit rate at a pre-pandemic low. Both firms and potential workers unwilling to take risk in an uncertain environment. That combined with lower levels of supply (immigration) and demand for labor implies that the breakeven NFP prints will look scary, but may not indicate a materially worse labor market.

Takeaway: Do not expect future cuts to spur greater hiring figures. If the problem is not monetary restrictiveness, then monetary easing will not have a meaningful impact.

CPI tomorrow projected at 3.1%, and I think it comes in on the mark (if not a touch higher). Yields up today across the board but short end action makes this look more like bond traders positioning for hot inflation rather than a general risk on move.

Tough to imagine a print so bad that it changes the outlook for the Oct meeting, but we could see some equity de-risking if the implied Dec rate moves. Fedspeak has been accommodative but not strictly dovish, so inflation can still crash the party.

Lack of NFP makes judging the other half of the mandate tough, but state unemployment figures give a good clue: a bit elevated, but stable. Multiple FOMC members have mentioned a lower breakeven NFP print, so don't read too much into sub-100k prints after the shutdown is over.

Position: SPY P @670 10/24, SPY P @666 10/24

Good chance the teflon market proves me wrong but asymmetry is to the downside.

Two things:
I do not think the Fed should be easing, but it seems likely they will. It seems most likely the FOMC wanted some breathing room in case conditions change, but I don't think any data or lack of data will meaningfully change the outlook for Dec. Overreaction by markets that have gotten used to dovish press conferences from JP.

The market may be complacent on the Dec FOMC meeting.

11/20, before Williams' big speech, the Fed Fund implied chance of cut was at 34.9%. After his speech we saw a swift rise to a 63.1% chance.

This makes sense because Williams and Powell are the closest in view at the Fed. This also brings the votes of Cook and Jefferson (following Powell), so we get the current head count:

Cut- Powell, Williams, Waller, Miran, Bowman, Cook, Jefferson
Hold- Schmid, Musalem
Not sure - Goolsbee, Collins, Barr (May just take cue from Powell)

All of this on the comment that there may be room for a cut in the near future! Surprising, given we will not have CPI before the meeting (which, as a reminder, was high and rising on last print!), decent if slightly soft NFP, and sustainable Unem Claims.

We are implying the views of many members off the one Williams comment, but 60-80% seems fair as this is a reasonable assumption.

Despite this, and with no significant Fed speakers in the last week, the implied chance has drifted up to 102%!!! or 87%, depending on whether you are looking at Fed Fund Futs or OIS.

I think a cut is the most likely outcome, but given what we have I think the markets may be overpricing a bit.

Important note: Year end effects may be distorting the discussed markets, so big grain of salt here. I don't trade strips, so may be off.

Fed funds futures pricing in ~1.5 cuts through Dec currently, vs. ~2.1 before the conflict started, overreaction to Iran conflict? Potential overreaction imo, $80 is not catastrophic and 1) conflict offramps soon, or 2) Iran's ability to disrupt the Strait of Hormuz is increasingly diminished/mitigated. Labor stable and inflation (via fits and starts) seems to be stabilizing with a 2 handle (less scary easier for Fed to put off if signs of output weakness start showing up)s. I would take the over on 1.5 cuts, but the voter mix is skewing hawkish vs. last year so we will have to see how it pans out (I wager a bit of a slowdown in H2 strips some of the hawkishness away).

Going to get the ol NFP model fired up, shutdown and tweaks took it out of commission.

Data quality still bad so didn't finalize model, but was looking around 30k, which would have been a big miss vs. print lol

Fed will need to see next print to confirm, but >1.5 looks to be holding

Fed funds future still stable ~1.5, but holy oil. Think this is setting up for a cl collapse on any de-escalation signaling. Once oil and tariff upward impulses clear inflation likely back to slow drift down.

Going to enter a small SPY debit call spread expiring 3/16, strike to be determined on open. We will see if sell off in Tokyo continues into London and New York.

I like >2.4% US CPI YoY at 38% on Kalshi. 2.4 is the safe prediction but the distribution of outcomes skews upwards enough to take a shot on ~1.6:1

Some points on this:

1. Core projected lower than headline MoM due to fuel cost tick up in Feb vs Jan, so YoY print depends on the core. Numerator CGPI shows reaccelerating in Feb vs disinflation in Jan
2. Weirdness with OER will be resolved in Apr per BLS, but even still Jan print was abnormal vs. trend
3. Falling grocery and used car prices most widely cited as reason for falling core but volatile and could be overstated
4. SCOTUS ruling did not affect majority of collection window, so possibility of increasing pass through as inventories clear from mid 2025 (late 2025 prints contaminated by shutdown collection)

Close on the CPI print, would take that odds every time, and broken down by subgroup it broadly confirmed the consensus estimates for the points above.

For Friday:

1. Expect core PCE MoM at consensus, 0.4%. Shelter weight is ~50% what it is in CPI and was a big drag on core CPI
2. I see GDP annualized above consensus, 1.6% vs 1.4%. Initial print likely overstated shutdown effects, as BEA estimated shutdown drag in the advance and seems high vs less-bad-than-feared impact