The US jobs report showed a much stronger jobs report but the unemployment rate was also higher at 3.7% versus 3.4%. Fed officials would like to see the unemployment rate come off the boil. They will start to see that in this report.
- For a June hike the expectations was 29% to 36%
- There is a 60% probability of a July hike
- The end-of-year Fed funds rate moved from 4.9% now 4.92%
The breakdown of the different sectors highlights showed.
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Professional and business services added 64,000 jobs, with continued growth in professional, scientific, and technical services, which added 43,000 jobs in May.
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Government employment increased by 56,000, surpassing the average monthly gain of 42,000 over the previous 12 months. However, government employment remains below the pre-pandemic level by 209,000 jobs or 0.9 percent.
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Health care added 52,000 jobs, consistent with the average monthly gain of 50,000 over the past year. The job growth occurred in ambulatory health care services (+24,000), hospitals (+20,000), and nursing and residential care facilities (+9,000).
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Employment in leisure and hospitality continued to trend upward, with an increase of 48,000 jobs, primarily in food services and drinking places (+33,000). Despite this growth, employment in the leisure and hospitality industry remains below its February 2020 level by 349,000 jobs or 2.1 percent.
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Construction added 25,000 jobs in May, including 11,000 jobs in heavy and civil engineering construction. Over the previous 12 months, construction had added an average of 17,000 jobs per month.
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Employment in transportation and warehousing increased by 24,000 jobs in May. This growth was driven by a gain of 12,000 jobs in transit and ground passenger transportation, offsetting a decrease in the previous month. Additionally, employment increased in couriers and messengers (+8,000) and air transportation (+3,000). Employment in this industry has shown no clear trend in recent months.
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Social assistance saw an increase of 22,000 jobs, aligning with the average monthly gain of 23,000 over the previous year. Within social assistance, individual and family services added 17,000 jobs.
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Other major industries, including mining, quarrying, and oil and gas extraction; manufacturing; wholesale trade; retail trade; information; financial activities; and other services, experienced little change in employment levels during May.
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Manufacturing dipped minus 2K
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Goods-producing jobs at 26,000, while service-producing jobs added 57,000
The US stocks remain supported:
- Dow Industrial Average up 206 points
- S&P index up 23 points
- NASDAQ index is a little lower +57 points
in the US that market:
- 2 year yield 4.394% versus 4.359% before the report
- 10 year yield 3.629% versus 3.616% before the report
Looking at the EURUSD, the price moved down to retest it’s 200 hours moving at 1.07312 and found willing buyers leaning against that level. The price is trading back at 1.0761 nearly unchanged from the premarket level.
EURUSD fell and found buyers at the 200 hour moving average
USDJPY is moving higher but the initial spike held below the near converged 200 and 100 hour moving averages. Those moving averages come in around 139.60 (look at green and blue lines on the hourly chart below). The current price trades at 139.20.
USDJPY moves up to test the hourly moving averages
The GBPUSD moved down to test the 50% midpoint of the May trading range (at 1.24933) and found that buyers. The price rebounded but is trading back down toward the 50% midpoint level. Currently trading at 1.2502.
GBPUSD falls to the 50% and finds buyers on the first look