Job growth in the US eased in June, as nonfarm payrolls (NFP) grew by 209,000, marking the slowest monthly increase since December 2020. The report exposed a weakness in the US dollar, pushing the world’s reserve currency down by 0.25%.
US Unemployment Rate Fell 0.1% in June
US nonfarm payrolls climbed by 209,000 in June, down from 339,000 in May, suggesting the red-hot labor market cooled. The numbers, published by the US Bureau of Labor Statistics, also came lower than market expectations of 225,000.
While the reading is still strong from a historical standpoint, the report represents a notable drop compared to May data. June marked the slowest month for job creation since payrolls declined by 268,000 in December 220,000.
Meanwhile, the unemployment rate slipped to 3.6% from 3.7%, in line with expectations. Annual wage inflation remained unchanged at 4.4%, while analysts estimated a slight drop to 4.2%.
The most robust job growth was seen in the government sector, which added 60,000 new positions in June, mainly at the state and local levels. Other sectors that added a significant number of jobs last month include health care (41,000), social assistance (24,000), and construction (23,000).
The latest NFP report came a day after the most recent ADP National Employment Report, which showed that payrolls in the US private sector skyrocketed by 497,000 in June, far ahead of the Dow Jones consensus estimate of 220,000.
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Dollar Index Slips 0.25% after NFP Data
The U.S. dollar plunged following today’s NFP report, with the dollar index (DXY) falling about 0.25% to hit the lowest level in the last 10 days. The greenback edged lower after the US jobs data missed analyst expectations.
Today’s dollar close will be closely watched as the DXY tests the 100-daily moving average support. The close below would likely invite more weakness for the world’s top currency.
Still, investors will likely see today’s jobs report as strong enough for the Federal Reserve to restart its rate-hiking campaign. The central bank has delivered 500 basis points (bps) worth of interest rate increases over a year, bringing inflation down from 9.1% to 4%. However, the annual inflation rate remains notably higher than the Fed’s target of 2%, which means that the May rate hike likely was not the last one this year, as some expected.
Do you think the US job growth will continue to decline throughout 2023? Let us know in the comments below.
The post US Added 209,000 Jobs in June, Lowest Since December 2020 appeared first on Tokenist.
