Washington – Trump Tweet Before U.S. Payrolls Report Raises Eyebrows

Washington – President Donald Trump set tongues wagging across Wall Street and among economists on Friday when he tweeted what some viewed as a tip about the big monthly U.S. payrolls report due out later in the morning.

“Looking forward to seeing the employment numbers at 8:30 this morning,” Trump said by tweet at 7:21 a.m. EDT (1121 GMT), just over an hour before the highly anticipated news was released.

The post was quickly retweeted thousands of times, especially by market participants, economists and financial journalists for whom the monthly data is a top-tier news event.

“Since we know the president gets the report way in advance, it’s probably safe to assume it’s a beat,” Yahoo Finance Managing Editor Sam Ro tweeted.

Indeed, the number was a bit stronger than expected, with 223,000 U.S. jobs created in May, 35,000 above the Reuters estimate of 188,000. The unemployment rate dropped to an 18-year low of 3.8 percent.

It does not appear, however, that market participants jumped to trade on Trump’s tweet before the official release.

S&P 500 e-mini futures were up about 12 points, or 0.45 percent, before his tweet, then nudged about 1 point higher in the moments afterward. There was no discernable pick-up in trading volume to accompany the move to suggest market players saw it as a tradable tip.

Similarly, futures on the 10-year Treasury note were lower and added fractionally to the losses, but as with the equity futures, no volume acceleration accompanied the move.

Larry Kudlow, director of the White House National Economic Council, said in television interviews later on Friday that he had briefed Trump on Thursday about the numbers. By law, the NEC head is one of a handful of administration officials allowed an advance view of the report before its public release from a high-security lockup at the Labor Department, typically on the first Friday of the month at 8:30 a.m. EDT (1230 GMT).

“It is my call on whether to send them over to the president, to give him a call or have a meeting with him. That’s just what I did last evening,” Kudlow said on CNBC.

“He has a right to know. He is the commander in chief. That’s all. He chose to tweet. His tweet basically said, like everybody else, we await the jobs numbers. You can read into that ten different things, if you want to read into it.”

Trump has frequently tweeted about robust jobs numbers after they’ve been released, but this was the first time he did so ahead of its release.

A 33-year-old rule from the White House Office of Management and Budget governing the release of embargoed economic data forbids executive branch employees from public discussion of the data within an hour of its release.

Last year, members of the Trump administration drew criticism for commenting on the numbers too quickly after their release.

Members of past administrations chided the president for breaking protocol and potentially offering an advance view of one of the world’s most market-moving pieces of economic data.

“If during the Clinton or Obama Administrations there had been a statement from @POTUS or any senior official in the morning before the Employment Report it would have been a major scandal – with all sorts of investigations following on,” tweeted Lawrence Summers, who served as Treasury Secretary under Democratic President Bill Clinton.

Trump’s post was also seen as heightening an already intense focus on Trump’s Twitter handle by market participants.

“Traders will now be watching the president’s Twitter account much more closely ahead of the jobs release to see if he says anything,” said Jason Ware, chief investment officer at Albion Financial Group in Salt Lake City.

“If he does (like today), then the forthcoming report is likely bullish and money will move accordingly. If he’s silent, maybe it’s not so great. Traders, right or wrong, may play that game for a while and that’s a potentially interesting twist.”