U.S. Nonfarm Payrolls Fall 23K as Unemployment Drops to 4.1%, Triggering Market Rally

According to U.S. employment data released over the weekend of August 8–9, nonfarm payrolls declined by 23,000 in July while the unemployment rate fell to 4.1%, signaling reduced near-term rate hike expectations. The counterintuitive data—where job losses coincided with lower unemployment—sent major U.S. indices higher: the Dow Jones rose 0.28%, the S&P 500 gained 0.62% to cross 7,750, and the Nasdaq climbed 1.3%. Gold futures recovered to $4,400 per troy ounce.

The labor force participation rate dropped to 61.4%, marking a five-year low, while hourly wage growth slowed to 3.2%, the weakest since May 2021. Market expectations for a September rate increase have shifted significantly lower.