Non-farm data is not the “answer,” but a tool to reveal market expectations. Although non-farm employment data is hailed as the “first data point in global financial markets,” its true value does not lie in directly determining market direction, but in amplifying existing expectations and divergences in the market. Many investors often seek a “standard answer” after non-farm data is released—for example, good data implying a bearish risk asset, bad data implying a bullish gold or crypto asset—but the real market is far more complex than this binary logic. The role of non-farm data is more like a mirror, reflecting whether the market’s previous expectations about the economy, inflation, and monetary policy are reasonable.

When job growth is strong and the unemployment rate remains stable, it may seem on the surface that the economy is resilient. However, if the market has already heavily priced in “strong employment,” the data might instead serve as a point for realization of those expectations, causing risk assets to fall rather than rise. Similarly, when non-farm data weakens, if the market has already been trading the narrative of recession, the data release merely confirms expectations rather than serving as a new shock. What truly matters is the gap between the data and expectations, not the data itself.

Moreover, non-farm is not a single indicator. Changes in employment, unemployment rate, labor participation rate, and wage growth often send different signals. Sometimes, employment growth slows but wages remain high, indicating persistent inflation. Other times, employment declines but participation rate rises, suggesting an improvement in labor supply. These details determine whether the Federal Reserve will truly shift its policy, rather than just a simple data fluctuation.

Therefore, for traders, non-farm is better used as a “calibration tool” rather than a “trading signal.” It helps us judge whether the current macro narrative is overly priced in or if there are expectation mismatches. A truly mature strategy is not to bet on the direction of non-farm, but to observe whether market sentiment and structure change after the data release. #非农就业数据