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US Jobs Report Keeps September Hike on the Table

A very mixed jobs report from the US as job creation comes out in line with expectations at 223,000, but maybe below what people were hoping for after a slow first quarter and poor jobs report in March. Meanwhile, previous non-farm payroll numbers were revised lower, with March’s reading falling to 85,000. Unemployment fell to the lowest level in seven years while participation rose back to 62.8 offering some further upside to the report.

All things considered, the report is very mixed and doesn’t really change interest rate expectations. There was a little something for everyone, whether you’re dovish, hawkish or neutral and this has been reflected in the uncertain market response. The dollar initially fell against the euro before spiking by 100 pips. The pair quickly stabilised just above pre-release levels which offers support to the notion that little has changed.

For me, I remain optimistic that interest rates will raise this year, probably in September. Jobs growth in April was good, albeit not great, but unemployment fell further and therefore wage growth should follow soon. The first quarter was poor but the same was true last year and the rest of the year was great following a decent bounce in April. I remain confident that the country will make up for lost job creation and output in the first quarter, in the coming months and quarters and rates will rise this year.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam [4]

Senior Market Analyst, UK & EMEA at OANDA [5]
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam
Craig Erlam

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