The U.S. labor market continues to remain resilient, with the Bureau of Labor Statistics (BLS) April non-farm payrolls (NFP) report providing further evidence of this strength. Following the data release, the U.S. dollar trimmed its losses against major counterparts but continued to trade lower.
Services Employment Keeps Job Growth Ticking
The U.S. economy added 115,000 jobs in April, lower than the downwardly revised 185,000 gain for March. Economists, on average, had expected employment growth to reach 65,000 jobs in April, sharply lower than March’s initially reported reading of 186,000.
The resilient job gains come close on the heels of ADP private payroll data, which showed an expansion of 109,000 in April versus expectations of 61,000.
The BLS Establishment Survey showed that jobs in the goods-producing sector grew by merely 10,000, as the manufacturing sector continued to bleed jobs (-2,000). The employment component of several recent private-sector activity surveys has also pointed to this weakness.
The private service-providing sector added 113,000 jobs, thanks to robust gains in healthcare and social assistance (+53,900), transportation and warehousing (+30,300), and retail trade (+21,800). On the other hand, government jobs contracted by 8,000.
The jobless rate, calculated based on the BLS’ Household Survey, remained unchanged at 4.3%. The U6 jobless rate, which measures total unemployed persons, plus marginally attached workers and those employed part-time for economic reasons, edged up to 8.2% from 8%. Average hourly earnings, a key inflation measure, rose 3.6%, faster than the downwardly revised 3.4% increase (previously reported at +3.5%) for March.
Stock Futures Pop on NFP Report, Dollar Continues to Languish
The E-Mini S&P 500 futures (ES) and Nasdaq-100 futures (NQ) added to their gains after the data release. The report, however, did not offer much support to the U.S. dollar, which continues to languish despite geopolitical uncertainty.
The U.S. Dollar Index traded down 0.13% at 97.93, although it recovered slightly from its intraday low of 97.88.
The focus now shifts to the University of Michigan’s preliminary May consumer sentiment survey, which will shed light on consumer sentiment and their expectations regarding the inflation trajectory.
