• 390K jobs were added to the US economy in May, above the 325K expected. 
  • This seemed to initially boost the buck, though wage growth metrics eased, easing pressure on the Fed. 
  • Measures of labour market slack were mixed. 

The US economy added 390,000 jobs in May, according to the latest Non-farm Payrolls (NFP) report released by the US Bureau of Labour Statistics on Friday. That was above the median economist forecast for a gain of 325,000 jobs, though slightly lower versus April's 436,000 gain (revised up from 428,000). The headline job gain was driven by a 333,000 gain in private sector employment, which was slightly above the 325,000 estimate. 18,000 of these were factory jobs, 59,000 of these goods-producing jobs, 36,000 of these construction jobs and 274,000 private service-producing jobs. Retail jobs fell by 60,700, while government jobs rose by 57,000. 

Despite the headline NFP beat, the Unemployment Rate remained steady at 3.6% versus an expected drop to 3.5%, while the U6 Underemployment Rate rose to 7.1% from 7.0% a month earlier. Average hours worked per week remained unchanged at 34.6 hours. The Labour Force Participation Rate rose slightly to 62.3% from 62.2% a month earlier, which explained why the unemployment rate failed to decline as expected. 

Average Hourly Earnings growth came in at 5.2% YoY in May, in line with expectations and below last month's 5.6% reading. However, the MoM rate of Average Hourly Earnings growth was lower than expected at 0.3%, in line with April's reading and below expectations for a rise to 0.4%. 

Market Reaction

The immediate market reaction has been for the US dollar to strengthen as a result of the stronger headline NFP number. But traders should be aware that sellers might soon come in, given the easing wage growth metrics that may be interpreted as taking some pressure off of the Fed to hike interest rates so aggressively. For now, the DXY is at session highs back to the north of the 102.00 mark.  

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD falls below 1.0500 after US NFP data

EUR/USD falls below 1.0500 after US NFP data

EUR/USD dropped below 1.0450 but managed to stage a modest rebound. The US Dollar preserves its strength against its rivals and doesn't allow the pair to gain traction after the data from the US showed that Nonfarm Payrolls rose by 263,000 in November.

EUR/USD News

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD lost nearly 100 pips with the immediate reaction to the upbeat November jobs report from the US and broke below 1.2200. The US Dollar Index clings to strong daily gains above 105.00 after the data showed that Nonfarm Payrolls rose by 263,000.

GBPUSD News

Gold retreats below $1,790 as US yields surge on US NFP

Gold retreats below $1,790 as US yields surge on US NFP

Gold price turned south and dropped below $1,790 in the early American session. The benchmark 10-year US Treasury bond yield is up more than 2% on the day near 3.6% after the bigger-than-expected November job growth, weighing heavily on XAU/USD.

Gold News

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange, founded by Samuel Bankman-Fried (SBF), has consistently made headlines over the past month for its liquidity crisis and triggering a collapse in the crypto ecosystem.

Read more

AMC advances more than 3% in premarket day after being halted

AMC advances more than 3% in premarket day after being halted

AMC stock is up 3.4% in Friday's premarket just a day after authorities halted trading due to unusual volatility. Thursday saw options volume three times higher than the 20-day average.

Read more

Forex MAJORS

Cryptocurrencies

Signatures