U.S. June nonfarm payroll data far below expectations, market expectations for rate hikes within the year cool rapidly

According to the U.S. June nonfarm payroll data released last night, the number of new nonfarm payrolls was only 57k, far below the market expectation of 114k, marking the lowest level in four months.

At the same time, the data for April and May were also revised downward, with a total downward revision of 74k over the two months, indicating that the market's previous assessment of the labor market's health was too optimistic.

The unemployment rate unexpectedly fell to 4.2%, lower than the expected 4.3%, but this decline was mainly due to a 0.3 percentage point drop in the labor force participation rate to 61.5%, rather than strong hiring.

By industry, the leisure and hospitality sector lost 61k jobs in June, becoming the main drag; professional and business services added 36k jobs; social assistance and healthcare added 25k and 22k jobs, respectively.

On wages, average hourly earnings rose 0.3% month-over-month to $37.64, and 3.5% year-over-year, a relatively moderate increase. After the data release, market expectations for a Fed rate hike cooled, with the CME FedWatch showing the probability of holding rates steady in July rising to 82.4%.

In summary, this employment report has largely dispelled the market's concerns about a Fed rate hike. The market generally expects the Fed to likely remain on hold this year, and the fear of rate hikes that had been permeating the market is gradually fading.

Looking ahead, investors need to focus on the potential impact of subsequent inflation data on the Fed's policy path. In the short term, the U.S. dollar index may come under pressure, while safe-haven assets such as gold may see an opportunity for a rebound.

#美国非农数据 #rate hike expectations