The dollar rallied following the jobs report, where NFP rose more than forecast, and earnings were better than expected. The jobless rate unexpectedly fell to a new low of 3.8%. The buck had been on the rise ahead of the report following a Trump Tweet implying a better than expected outcome. EURUSD fell to 1.1648 from near 1.1670, while USDJPY topped at 109.67, up from 109.45. Equity futures continue to indicate a higher Wall Street open, while yields are higher.
U.S. nonfarm payrolls increased a solid 223k in May, gains of 159k in April (revised from 164k) and 155k in March (revised from 135k), for a net upward revision of 15k. The unemployment rate fell to 3.8% from 3.9% and is the lowest since late 1969. Average hourly earnings rose 0.3% after edging up 0.1% previously and are up 2.71% y/y versus 2.56% y/y. Hours worked were unchanged at 34.5. The labor force participation rate dipped to 62.7% from 62.8%. Other details show the labor force rebounded a modest 12k after dropping 236k in April, while household employment climbed 293k after the prior 3k gain. Private payroll were up 218k (ADP was +178k), with the goods producing sector 47k higher, while construction was up 25k, and manufacturing up 18k. The service sector added 171k. Government added 5k. While the report was strong, it maybe wasn’t so hefty one might have assumed given the president’s tweet.
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